1rfv"T Thh Tr OF TMXJrDKTATITNA T l AN KTCUD DR REONTRUDTITONT1c ATND TWAM E r %DXUEX1T JL1FJ% d1.J...J L,1I1 L IJI I1lq L IWI'.JIfLI., .1JrIx11V A' L S.J xl..Ji- .JIN JL a &%.jllq iIX114L LJ-JZ V J-IL'JLW IVLJL,I I INTERNATIONAL DEVELOPMENT ASSOCIATION Not For Public Use _ PS-13 t ~~~VOL.7 _ Report No. P S-13 BANGLADESH LAND AND WATER RESOURCES SECTOR STUDY (in nine volumes) VOLUME VI RURAL DEVELOPMENT INSTITUTIONS CONTAINING: Technical Report No. 17 - The Rural Works Programs Technical Report No. 18 - The Thana Irrigation Program Technical Report No. 19 - Agricultural Credit December 1, 1972 Asia Projects Department I -. use- - -- *- n~t. -fl. TS . -~ A .- tt 4 .. ~ I RlIS repor;L Wa prepardI for 01 fLIcI U5s olly Uy tLhe Udi! B JIVGup. IL 1114r, ,a UL UV, b UUbJU, qUUotU or cited without Bank Group authorization. The Bank Group does not accept responsibility for the accuracy or coinpleteness of the report. I Note II MI,hTe - -Lard4 - ?d -ae -eure Sector S_ d ej- .LIA LJjLILU CLLLU W0CLi.L' nWVU_V UO. i)ULfVi, O~LOUJ Bangladesh" dated December 1, 1972 was prepared between x 9_ r-., ^-- .L2L - 0 1 *9^ ~.2 ivy 1971 a,II ul oide suuiier of 1972Ie uinuer wite general± supervision of the Bank, by staff members of the Bank, and FAa, With fu-bstantial help from consultants. Tne UNDP and the Bank shared the cost of the consulting services. The study is made available on the understand- ing that it does not necessarily represent the official position of the Government of Bangladesh or of the Bank. The study is based mostly on data coflected prior to March 1971. Although some of the information contained in the study is out of date, the essence of it is valid and it should be useful to the Government of Bangladesh and to other countries9 agencies, and institutions interested in the development of Bangladesh. BANGLADESH - SECTOR STUDY VOLUME VI - RURAL DEVELOPMENT INSTITUTIONS 2 FOREWORD i. The Rural Works Program (RWP), the Thana Irrigation Program (TIP) and the agricultural cooperative credit system of the Integrated Rural I)e- development Program (IRDP) represent a concerted effort to develop strong rural institutions throughout Bangladesh. Construction of basic riual physical facilities (roads, drainage and canals, flood embankment and community building) under RWP, organization of farmers into viable economic groups that can undertake cooperative rental of tubewells and other coopera- tive enterprises under TIP, and extension of credit to small farmers organized for cooperative purposes under IRDP, have a major role to play in the dissem- ination of new production technologies. ii. Each of the three programs evolved from experimental work at the Academy for Rural Development at Comilla. Each program operates at the Thana level, at which it was determined (for reasons of size, cost, communica- tion and economic organization) that rural people and Government officials could cooperate effectively in planning and implementation of rural develop- ment programs. Thana development plans provide the framework for RWP and TIP project work schemes submitted to Thana councils by the union councils. The Thana Council (and particularly the Circle Officer) is responsible for overseeing the planning and implementation of the development program. Thana Council headquarters are also the sites of Thana Training and Develop- ment Centers (constructed under RWJP), workshops for repair and maintenance of irrigation pumps, and warehouses for agricultural inputs. They are also the sites for the new Thana Cooperative Credit Associations operational in 20 Thanas, and to be extended countrywide under the IRDP. iii. The Integrated Rural Development Program is directed towards the small farmer. The Thana Cooperative Credit Associations (TCCA's) now provide only agricultural credit to their affiliated village agricultural coopera- tives. Ultimately they should also provide marketing, storage, processing and other agricultural cooperative facilities. These functions should aid farmers in benefitting from increased productivity, and provide increased incentive to farmers. iv. The three programs for developing rural infrastructure are mutually reinforcing. They have withstood trial, and in the case of RWP and TIP the test of country-wide implementation. A detailed account of the RWP, TIP, and agricultural credit systems (including the plans to implement the IRDP) are ',/ The Reports in this Volume are based on work done by an appraisal mission including Messrs. Craig-Martin, D. Hoerr and R. Stern in February-MaLrch 1971. (ii) given in the following three reports. All three are in need of updating and review in the light of recent institutional changes in Bangladesh. However, the recommendations for improvements given in the three Reports should be valuable in an.y reconsideration of rural institutional policies in Brngladesh. RESTRICTED TET@vDMGTAMA AMKTV Vr)D T>VnfNTQrDTTr'r'r'TM AMTn nV'TvT^fVTMT TDTA,TrPV D7,TArPnAA T T i 'alTlT ?A"V AQ TArTTh WTnl'r D~f~ ,±i 1. Li LJ'fL1 .1 J..LiA St. J < JJhMA U X Li Lt LWILi.J* L ;\ VL.L Li E3 ..LL Z ILV n Ut i V .L.ILJ. rJf' .3.1 T1T TA rTI AT DTJETT APvN1TrD ASSOATCI'TTATAION TAND.TT A Drr% T.1A rI1'T) fl'C%TflrtQ CRESOfuRC QrW'lrSuT .litViJC ADILi' VAvw±ria. IUJ0vzJfJ0 orikiluI1. C)Jii.U VOLUME VI RURAL DEVELOPMENT INSTITUTIONS TECHNICAL REPORT NO. 17 THE RURAL WORKS PROGRAM December 1, 1972 Asia Projects Department BANGLADESH - SECTOR STUDY 'VOLUME VI - RURAL DEVELOPMENT INSTITUTIONS TECHNICAL REPORT NO. 17 THE RURAL WORKS PROGRAM4 TABLE OF CONTE;-N'IS Page No. S-TJK-AR-Y AND CONC-iLJSIONS *...................00**. *"* i - iii I. INTRODUCTION ..*.....................o............ 1 II. RWP OPERATING PROCEDURES *....................... 1 III. PAST PERFORMANCE *....o................... e ee 3 IV. CONSTRUCTION METHODS ........................ 4 V. A BENEFIT/COST ANALYSIS. OF FEEDER ROADS *......... 5 Vl. HINOR WATER CON1TROL WORKS 8..**................. 8 LisAt of AppDices 1. New Works Cost Estimates 2. Mvqaintenance Cost Estimates BANGLADESH - SECTOR STUDY VOLUME Vl - RURAL DEVELOPMENT.INSTITUTIONS TECHNICAL REPORT NO. 17 THE RURAL WORKS PROGRAM SUMMARY AND CONCLUSIONS i. The Rural Works Program is designed to channel the initiative of the rural people for rural infrastructure development. The program, which was tested for a year in Comilla Thana before being established. on a country-wide basis in 1962, operates through a three-tier system of local government councils, the most important of which has proven to be the middle tier Thana council. Funds allocated. to the local councils by Local Government (LG) Department.enable the councils to implement labor intensive construction projects within their jurisdiction. Planning for rural construction works begins at the lowest governmental level, the Union Council, where local members d.evelop project plans for their respective works. Project works are limited.to roads, drainage canals, flood embankments and community buildings, and. must be consistent with long range Thana development plans. Work programs must be approved.by the LG Department after they have been reviewed.successively by each local council. By engaging the rural people themselves in the planning and implementation of project works, the RWP offers a rapid and. relative- ly inexpensive means of constructing and improving rural infrastructureo, and creates a large number of employment opportunities during the slack agricultural season when unemployment is as high as 60% among rural workers. ii Since 1962, three quarters of RWP funds (totaling Rs 710 miLLion) have gone into the construction of roads, and. the balance into drainage and canals, community buildings and flood. embankments. Over 12,000 miles of kutcha (dirt) roads have been constructed., and.71,000 miles of kutcha roads have been repaired. The sizeable allocation of RWP funds towards roads, and,particularly kutcha roads is likely to continue. The estimated. economic rate of return on new feeder roads construction into the existing road systemVindicates that kutcha road construction (with a 1h4 average rate of return) is more attractive than pucca (paved.) road. construction (with a 9% average rate of return) -- a calculation that takes into account recent construction costs and projected.traffic intensity, but not the social benefits, such as better access to schools, and. better services.. iii. The program was highly successful until 1967 when it began to be used. politically and. control over project works and.funds became lax. The recommendations that follow are based-on a pre-war appraisal of the status of the program and. are directed towards reinstating RWIP (or a suitable institutionalJalternative) as an effective tool of rural development. - ii - iv. The following suggestions are offered. for consideration by thp Secretariat of Local Government and Rural Development: (1) A Deputy Secretary of suitable rank and.calibre may be needed. to assume the directorship of the RWP on a full-time hasis- (2) The instructions issued by the Secretariat to local councils governing the operation of the Rural Works Program may need to be reviewed, up-dated, and re-issued. Among other things, the revisions may consider how to strengthen local planning (particularly long-term planning) and how to ensure public accountability for RWP funds possibly by reinforcing the requirement for public posting of information per- taining to RWP projects. (3) SDecific efforts may be necessary to see that RWP budget allocations are made on the basis of population and area, or physical notential. Although such rules remain on the books. there aDDear to have been instances in which it has not been followed.. Deviation means the allocation process may become subject to strong political pressures. (4) The feasibility of introducing a fully independent system of audit. designed to prevent the misuse of funds. needs to be exDlored.. Standardized specifications may have to be developed-and distributed to all executing agencies with the reauirement that they be followed for all projects built under the Rural Works Program. Present specifications are looselv written and may be difficult to enforce. The immediate benefits might be better quality in construction. In the longer term, cnnmqtruetinn cnsts tconld deAline as contractors become familiar with these specifications and bid documents. (5) Provisions requiring that previous project works be main- +ained bothh frnm n--al onnunil revenues and from new allot-ations may need to be more strictly observed. The possibility of providing annual funds and a perman-nt labor fnrnc +to nr'na a oliml Tmay be worth explorincr, (6) Supervisors may be required tO be in the field. continually during the Works Program season to check on the degree to which regulations are being fo-llowed, Enforcement of the rules and. action against violators may be important. Additional engineering skills for all Rural WiJorks projects, but particularly for drainage schemes, may need to be made availabie to local touncils. (7) More study may be necessary to coordinate individual ~~4-e l -- - _ _ _ LS An.U4. _ I.T U1 s5_ _ 4-1o+;_AN UPh se o'L 1i L L%LUC.L VV14. LZL ~.%J.aLCI1. k.M .L 41"rL- V~ UV~ JV. ~L.L,0A VJ .&iILU.L- taneous construction of drains, embankments and roads in some areas. l"s, rmiay req-u±ire rLore sopUhiU.a UVU 0 eng..e,' ski.L.Ls Utianl are LnoW available at the local level. (8) It may be useful to reinstitute the annual meeting and taednIlnlg courS for Circle Officers inL Co(l'a-L.LO. In UUUSB LUULU aLsu be attended by the secretary and officers of the LG Department who would then be able to meet Circle Officers and make clear that thev are available to assist any Circle Officer. Re-establishing communication between the field and the denartment would help the denartment reflect adequately the needs of the program and the field officers. The training progpram for tiefhn-¶ al mmAervisors may need to he rev-i,esei to off er the technicians more specialization. The "Jack of all Trades" approach whic-h is now being used may not he sat- ifaH+-ory in the futr-e- and the opportunity to gain practical experience is limited by the general low volTIme of constrction. BANGLADESH - SECTOR STi= rflT TT,u; TTr _ MrT A T1u T D mc., Tni -r. ,y.UrZl- NO- 1 7 Mn'O n,T T,T . t- - - DRV." No THE RUEULL WORKS PROGRAM I. INTRODUJCTION 1.01 InI recent decades, natural calamities have been so common in Bangladesh that public expenditures in rural areas have gone largely for relief rather than infrastructure. Research into the problems of the rural population and some small-scale innovations by the Pakistan Academy for Rural Development (PARD) in Comilla indicated that if rural infrastructure development *i4 to occur it has to be based. on the initiatives of the rural people themselves. Further, the framing of rural development programs and their implementation should be by rural leaders in partnership with government officials. Such partnership needs to be close to the people and the Thana level has been chosen as the most appropriate level. Thanas were formerly revenue and police administration units, for which manageable size pemitting close contact with the people was similarly essential. There are 413 Thanas in Bangladesh averaging in area 192 sqmiles= 1.02 With the oblective of tapping rural initiatives and associating the rural population with rural development, the government introduced three closely related programs: 1) the Rural Works Program (RWP), 2) the Thana Irrigation Program (TIP), and 3) the Integrated Rural Development Program (IRDP). The first two provide the infrastructure on which to develop the productive capacity of the land and the third nrovides the cooperative organization through which increased productivity can be realized. All three operate within the same Thana institutional framework. ensuring their close integration and maximum decentralization. In all these programs the rural population formulates the project proposals, particinates in the nlanning of the nrograms and to a large extent executes them. Local officials control expenditures and provide technical serlevic- -Togather thev make possible a large number of small. widely scattered but important projects, which would otherwise be very difficult, impos,sible to execute. T.he Prmal W.orks Program was 8tart+d in 1962 and included the construction roads, bridges, culverts, embankments, drains and rural buildings. II. RWP OPERATING PROCEDUaES v 2.01 Within the framework of five-year plans, annual budgetary allocations were made t tn fhe Locnl flnvernernrti (T.() npnartment. fnr the Thirnl Works Prornrm',, The Department sent out directives to local government institutions setting fo'rfh the wnerp atego __ nf nag-rams whinh they couv d *der+ke (+t"s limiting their activities to those which had priority in the develop- me.nt -nn1v.) v -- d -. the pro.cedu.Tmres hi.r.hirMh AhA +n he fnlhmnwei in both the planning and implementation of these programs. Allocations of 1/ The procedures which are described are those used prior to the establishment Of tne independent state of BDangladesh. As far as i9SO iowAhese procedures are substantially the same at present (April 1972) -2- R7wP funds by the LG Department to counciis were made on the basis oT population. 2.02 Planning for rural construction works commenced at the Union Council, the lowest local government institution; each elected member of the councilwas charged with initiating and formulating plans for projects in his own ward. These were then presented to the Union Council which discussed them and aggregated them into a Union Plan. The Union Planwas submitted to the Thana Council, which comprised chairmen of its constituent Union Councils and the 'nation building' department officers assigned to that Thana; the council was able to approve or reject the schemes but could not revise them. On the basis of these union proposals, the Thana Council alsodeveloped plans for its own projects. These annual plans are supposed to conform to five-year plans for roads, drainage and irrigation whichwere maintained at Thana level. 2.03 Consolidated Thana/union planswere submitted to the District Council for review and approval. The District Council then submited these schemes for the entire District, as well as District Council plans, to the LG Department, which again reviewred them,. Funds were then released to councils at all three levels to carry out the programs that had been approved. A number of important rules govern the actual use of funds once they had been provided. Among these were the requirement that labor-intensive techniques must be used where feasible and that contractors should not be hired to do the job unless necessary. Local Council officials were charged with the supervision of the work under the program, and detailed accounting procedures werelaid down for the use of funds. The records at each Union were audited by the Thana Circle Officer(Development) (the senior LG representative at Thana level) and checked in the field by inspection officers of the LG Depart- ment. Misuse of funds was controlled primarily by requiring that public information on the size of each Council's allocation and the amount spent for each project be made readily available, usually by billboards. 2.04 Project committees set up by Union Councils were responsible for actual implementation of rLral works projects. Theywereusually headed by and appointed by the ward member in whose constituency the project was. Each committee had a secretary who waspaid the equivalent of 2% of the project cost, and who was responsible for maintaining the required records. Project committees and works were supervised by Thana technical supervisors who reported to the Circle Officer. Once projects were completed, the local cauncils werecharged with their maintenance. Each year 25% of local oouncil revenues wereto be spent on maintenance work, and top priority in using new RWP funds was to be given to repair and maintenance work for facilities already constructed. rPr-r i nA Cn PO ArAT1C' achievements of the RWP were impressive. Funds available totalled Rs1,0 t 4L'i aIL.Lr.L d t.A11.L e allocated Uto thLe LAJ.L.±L. AL U construction.s in thIe following proportions: Percent Roads 74.5 Drai.nLage and CanalLs 4.1. Embankments 4.0 Comm,uniy BDUldinus 16.7 Miscellaneous 0.7 3.02 The mileage figures given in the "Performance Report on Rural Works Programmes" are of doubtful validity in the view of Evaluation Officers of LG Department. However, a careful independent review* for the period 1962-1968 still presents an impressive picture of achieve- ments, as follows: Constructions 1962-1968 Dirt roads: new 12,381 miles repaired 71,036 It Area benefited 2,955,000 acres Community buildings 3,195 number Employment created 208,500 thousand man-days 3.03 After 1967, the RWP began to lose its connection with the grassroots. The Thana Five-Year Plans for 1966-70 prepared. on the initiatives of the rural population through Union and Thana Councils, became progressively less the basis for annual programs. Union Council members, not facing re-election, lost interest and the program began to be misused by some councils to promote narrow partisan interests. As a result the control over the program by the LG DeDartment weakened, leading to laxity in implementation preventing full potential benefits from being realized. LG Department had no copy of the Thana Five- Year Plans and in some Thanas they had been lost; in many cases Thana * By Mr. John Woodward Thomas, Harvard University. officials had no record of what part of them had been completed. As a result projects were approved as presented as long as funds were avail- able. LG Department acdinistrative and technical directives were progressively ignored and public notices of works undertaken were not posted or published. 3.04 If the program is to regain momentum the new annual programs may once more need to reflect rural initiatives. LG may have to take more direct interest in them so as to exercise closer control over officials and councils, and enforce compliance with directives and the posting of pub- lic notices. 1/ IV. CONSTRUCTION METHODS 4.01 The construction methods under the RWP purposely made maximum use of local labor using spades and head baskets. Compaction was by hand rammers or by sections of concrete pipe used as hand pulled rollers. Lack of pulverization resultedin many air pockets and voids. There no moisture or density control and severe deterioration of embankments occured. Turfing (sodding) the shoulders and slopeswas sometimes done. This is an important step, particularly where the embankment is exposed to flowing water, and all new roads and embankments may need to be turfed. Paved roads were built over these embankments; the top 4.5 inches (6 inches loose measure) wasmetalled prior to applying a 2-inch layer of sand followed by a brick soling laid flat. The joints were filled with sand or powdered earth. For more important roads an additional layer of brickwas laid on edge in herring bone bond. The most important roads then received a bitumous seal sprinkled with sand or khoa chips, or a structural overlay of either asphaltic concrete or Portland Cement concrete. 4.02 Although the design standards varied somewhat from Thana to Thana and from project to project, realistic averages can be applied. These averages, furnished by LG Evaluation Officers and verified at the Thana level were as follows: Average Typical Sections Width at Side Height Pavement ton Slone or Width Depth Embankments 8 ft. 2:1 3 ft. -- Drains 10 ft.. 1:1 3 ft ._ Dirt (kutcha) roads 10 ft. 2:1 5 ft. __ Paved (nucca) roads 15 ft. 2s1 6 f't. 10 ft. I/ U-4--As ar-ek1 - beleve 'k- 4be --sta ;4 sa - ---- 4rse Ap.-l4 I'1972) ::!L LAs OJ , ww."~ V w. %" Jw A A U.-J.J SAA Q -W U JJ. .L *.9 I d. as those described. Concrete brioges and culverts were designed ior Hl5 (15 ton) loading. T;hey were mostly one lane having a clear roadway width of 10 1-61. Wood bridges (wnichwereused very infrequently)were also one lane and were designed for H8 (8 ton) loads. Constzuction specifications were available to the Local Councils through the Technical Supervisor. They offer little,if any, quality control and appeared to be um-enforceable. 4.03 Most projects received from four to six bids. Adequate labor force was certainly no problem, especially when the peak construction season did not conflict with the main cropping season. Basic skills in engineering, accounting and administration seemed to be the limiting factors when estimating the construction capabilities. 4.04 Directives dictatedthat 25% of the locally raised budget would be used for maintenance of works built under the Rural Works Program. This amountwasinadequate to keep the facilities in satisfactory condi- tion. Works were often allowed to deteriorate until they had to be re- built as a construction project. Little, if any, equipmentwasavailable at local level for maintenance and no permanent labor force was kept for that function. V. A BENEFIT/COST ANALYSIS OF FEEDER ROADS 5.01 Clearly, the primary benefit of the feeder roads is the opening up of the countryside to markets and the consequent gradual monetization of Bangladesh. Analysis of the benefits of. feeder roads in Bangladesh, however, is extremely difficult due to the high rate of unemploy- ment"(60% during the winter season) among the rural workers. Generally, a major benefit of a road system is that it saves time. but in a countrr with a surplus labor force this benefit must be heavily discounted. 5.02 Because of the high rate of unemployed. the labor component o : capital costs has been systematically shadow-priced at Tks 1.70 per day --- which is about 60-70% of the day rate paid to unskilled labor under the Rural Works Project. Road Building Construction Costs (Mile) Market Price Shadow Price Kutcha 1 5,600 9,522 Pucca Single Layer 67,500 56,250 Herringbone 100,200 87,860 Bituminous 150,4oo 135.968 - 6 - 5.02 Right-of-way costs have been estimated atTks 10,500 per mile in the case of kutcha, and treated as a sunk cost for pucca mileage as the latter is assumed to be built over old kutcha in all cases. A number of silmplifications have been introduced into the usual analysis for given standards of road sizes and surfaces. The economic aspects of vertical and horizontal alignment, and slght distances, have not been included for these lightly travelled roads, nor have grades, since vir- 44 ..- J _ J.. 3 , y 1 1,L h .A50 .-PA ; .s M -+ Vr, - 4 1, nol anfla 3A.-1- h-. bAnn madfof varying road width since vehicle "interaction" is so infrequent, and other considerations (such as accident losses)1 nr tr vi1 -_ Wh1e these fa-tors may be of some consequence in many contexts, their omission does not de- traGt from an anilvsis of feeder roads in Bangladesh. Econoinic Rates of Return Qsz.zvw P-Les0 ri.Lrl,e, rMaretP-ce Average Marginal Average Marginal Kutcha 17% 10% 23% 13% Village Pucca Single Layer 13% 7% l9% 11% Herringbone 10% 5% 14% 8% Bituminous 4% 2% 6% 3% 5.03 The main results of the benefit/cost analyses are set out above. They represent an estimate of returns on a mile of road in the existing feeder road grid--using current construction prices for new roadway and pro- jecting traffic intensity into the future based on an average square mile of Chittagong and Comilla districts. Since the rates refer only to new construction, _J _L .1 _ ~ L _ I - _'L -t _ a_ 'I 1 A. - L. - - -.- A I - __ - - - A - - - - I _- - _. - - - _ _ _ _ __ _ -- Ih A itk LS Clear thaLt "rehaldItaion" woldu L_ve U higher 5tructure of returns.=r results are not particularly sensitive to changes in anything but cons- tiructioncost Iincludnle land values). T-. fact, veryAAJtar.ti.' S.ges in either benefits or maintenance costs, or in length of road life, cause relatively small shifts in returns= T.he rates of Yet,n' ArA co)n- servative. Since data was uncertain those chosen may have erred on the conservative side thereby depressing the rate of return. For instance the mileage of kutcha roads for the two sample districts was that from the Harvard Data Bank. Records kept by the LG Department showed a zrid with only half the mileage of the Harvard records. Using the higher mileage means that traffic densities and consequently benefits may have been understated. 5.04 In general, kutcha construction appears somewhat more attractive than pucca, even single layer brick: constructing pucca to a higher standard, which means higher construction costs but lower maintenance, only serves to reduce the overall return, for both double-layer herring- bone and bonding over with a bituminous carpet. The difference between kutcha and pucca returns would also be widened to the extent that pucca mileage Ls "inter-vil±lage! feeUdr rod-uw-ay I-CLUIr tIhiaLI V-VllagU-, for the doubled savings per mile would be much more than offset by decreased 5.5 The aparnn-nt advarinta+.ge of knltcha is frther Ineased yv a more explicit consideration of the economic "switchover point" from 7tnh7 +o ninna- ThA euestion is nomnlicated bv traffic comnosition l/ A fair amount of this work is done each year, part of it in the nature of "stage construction", and some of it performed in the place of omitted maintenance. -7- projections and what constitutes an acceptable rate of return, but if 7% on shadow priced benefits is acceptable, single layer pucca could reasonably be laid over kutcha when traffic approximated, say, 2,500 tons per pucca mile (or traffic from about 8 sq. mi. of the sample area at present output levels). However, this is "affordable", not recommended, for running this tonnage over kutcha rather than pucca would give a return in excess of 50%, rather than a mere 7%. To conclude in favor of pucca one must reason either that there is a very severe downward Icink in the kutcha benefits curve as tonnage rises (not likely at these traffic levels)that kutcha mileage is out of use at critical points during the year (not true on the whole), or that there are very significant, unmeasured benefits to all-weather roads, or whatever othe:r unique characteristics pucca may have. As will be seen below, the question becomes very much a value judgement. 5.o6 There is a long list of unquantified benefits which are not included in the analysis: some of the more important ones being reduced costs--or increased income--from better access to supplies and services, including schools (and extension services), medical (family planning) and emergency services, mail, etc.; traffic originating from secondary marketing, marketing by deficit farmers who must pay debts, as well as casual traffic, e.g., field to field, and so on. Despite the difficulty in quantifying these benefits, several of them (such as family planning and better access by extension workers) are frequently assigned quite high values. 5.07 In short, the road building activities of the RWP--despite their limited attention to economic considerations--do not appear to have overbuilt the kutcha feeder road grid. Further extension can be considered justified in either "marginal" or "average" terms, depending upon the assumptions employed. If the incremental mileage is assumed to be built on the edge of a primary market grid, the measured. shadow priced rate of return would be closer to that for the hypothetical "marginal mile". viz., lo0but if the mileage is expected to finl in some gaps which exist nearer the center of the grid, the rate of return would be closer to the "average" of 14%. As noted above, neither of these rates measures anything like the whole of benefits to kutcha roads, hence would appear to justify further development of the grid's density--the extent depending upon value judgements as to acceptable rates of return. However, this Justification broadens to include pucca roads only insofar as special circumstances prevail, whether with respect to traffic density or an absolute requirement fbr all-weather access. Even then, the cheapest form of pucca surfacing seems desirable. V1. MINOR WATER CONTROL WORKS 6.01 The main component parts of water control works under RWP are excavation of drainage canals, construction of culverts (and. bridges) to restore natural flows, and.construction of low flood control embankments. Estimated.unit costs are: Drainage excavation Tks 3,900 per mile Embankments Tks 8,000 per mile Culverts and bridges Tks10,300 each 6.02 Cost estimates are from the same sources as in the roadbuilding component of the Rural Works Program. Canals are expected. to require only Tks 85 maintenance per mile annually, while maintenance on embankments is estimated. at Tks 977 per mile in the first year, Tks 488 in the second, Tks 24W4 in the third., and.Tks 217 annually thereafter. The maintenance costs of bridges and.culverts are included.in roadways; structural maint- enance would,be negligible. 6.03 A Bank Mission which appraised a Rural Works Program in 1971, estimated. the following need. for minor water control works for 20 Thanas:- 166 miles drainage excavation, 274 miles embankments and 952 culverts and, bridges. The estimated total cost of these works was Tks 12,645,o0o. 6.04 Benefits from drainage were based on the assumption that each mile of canal drains 48 acres, and. that with better control or water levels, production would rise by 17 maunds paddy per acre on the average. Both these estimates were probably quite conservative, particularly the former. The LG Department Performance Report average was over 200 acres per mile, but Thomas' 8 thana sample survey suggested use of a lower figure. At Tks 22 per maund paddy, annual output would. have increased. by Tks 2,980,032. Government estimates of benefits from the flood.control embankments ran to several times the cost per year, but the estimates were based on inadequate data. The mission assumed. that benefits would. at least equal costs. No returns were assumed, to the expenditure on culverts and.bridges since th-eir main function was simply to restore natural water flows interrupted.by other rural construction works. Despite these minimizing assumptions, estimated. returns on the total water control investment were in excess of 100l, because drainage had.such an extraordinarily high benefit/cost ratio. Even if the acres were drained, incremental output and rice prices had all been cut by 25%, and the canals had been assumed to deteriorate in a single year, the benefit-cost would still have been 2.2 to 1. APPENDIl 1 Page 1 BANGLADEAH - SECTOR STUDY NEW WIORKS COST ESTIMATES Unit Cost - Embanknent 81 2: .I% , 21 /natural ground. 20' earthwork (8 + 20)1 4 ft2 ( 2 )-' 42 x 5280 221,760 ft7ndM 221,760 at Kts 25/1000 = S,S44 Tks/mni turfing ( 32 + 62 4 4) 2 21.4 ft2 21.4 X 5280 _ 112,992 ft2/mi 112,992 at Tks 15/1000 - 16'5 Tks/mi TOTAL 7.2 39 Tks,tni CALL 7,200 Tks/mi Unit Cost -- Drains 10' /natural ground 1:1\ 3 '/ I' / earthwork (130+ = 21 f 3 =21ft 21 x 5280 : 110,880 ft3/mi 110880 at Tks 35,/1noo = 3,88j0 ks/Mi CALL 3,9900 Tks/ni APPENDIX 1 Page 2 Unit Cost - Direct (Kutcha) Road 10' 21 v ,,il, ""' Sturf ing ' mtural ground 30t (10 4 30) ; = 100 ft2 earthwork ( 2 ) - 100 x 5280 = 528 000 ft3/mi 528,000 at Tks 251000 = 13,200 Tks/mi turfing 0J52 - 102 4) 2: 30.4 ft 30.4 x 5280 - 160,512 ftr/ni 160,512 x Tks 15/1000 = 2,408 Tks/mi TOTAL 15,608 Tks/mi CALL 15,600 Tks/mi. Unit Cos-t - Surfaced (Pucca) Road 141 2:1 -i' I \,,turfing 6' 2' 1 natural ground I- ...38' (14 + 38)6 I '6 ft+2 earthwork ( 2 ) 156 x 5280 823,680 ft3/mi 823.680 at Tks 2A000n = 20,592 o ks/o rr turfing (62+ 122 . 4) 2 :-34 8 ft2 34.8 x 5280 -183,71.7, ft.2,4An 183,744 at Tks 15/1000 2,756 Tks/nmL TOTAL (earthwork and turfing) 23,348 Tks/mi CAT.T 23,, : I-' APPENDIX I Page 3 Assume that for an average new Pucca road, an average Kutcha road is already in place. Earthwork 20,592 - 13200 7,392 Tks/mi Turfing 2.756 Tks/mi TOTAL (earthwork & turfing) 10,148 Tks/mi CALL 10,100 Tks/mi Surface Boxing (preparation for pavement) 10' x 5280 - 52,800 ft2 52,800 at Tks 5/100 2,6h0 Tks/nii Edging (bricks along edge) 5280 x 2 = 105.60 ft. 10,560 at Tks 18/i00 1,900 Tks/mni Metalling (broken brick base) 511 x (10' - 2 x 2-3/4") x 5280' 21,156 ft3/mi 21.lq6 at Tks lhO h00 29.618 Tks/nii Sand (2"1 thick mat.) (10' - 2 x 2-3,/1n") 5280- 5A7 ft2 50,371 at Tks 6/100 3,022 Tks/mi Soling (brick laid.flat) (10' - 2 x 2-3/h") 5280_ 50,371 ft2 <017- -nat. Tiks ).no,h oo= 01l8 Tks,/".d TOTAT- (surfacing with single laver of briick) 5,-328 Tk./yri CALL 57,300 Tks/n.i This is consi Are an averag cnnrdition for a newPucca road.. Therefore, the average cost of a new Pucca road would be: earthwork and.turfing 10,148 Tks/mi rn7 '9tR Tlrk /m; TOTAL 67, 476 Thsr/A.mi r AT.T. 67 ,500 l1rc/.4i APPENDIX i Page 4 Unit Costs - bridges & culverts For average unit costs of bridges and culverts, computations are shown for 10' (concrete slab) bridges, common-Ly called culverts, and eu' tconcrete girder) bridges. These are the minimum lengths from the standard designs furnished by B.D. and L.G. Recognizing that some of the structures will be longer than minimum, thus increasing the unit costs, some of the structures will also be pipe culverts which will offset this differential. 10' (slab) bridge Abutment (12 foot headwalls and wings) 3 excavation 2 (12 x 6 x 12 + 10 x 6 x 10 x 2) = 4128 ft 4,128 @ Tks 35/100 =i,448 Tks brick 2,650 ft3 @ Tks 235/100 = 6,227 Tks concrete 376 ft3 @ Tks 310/100 = 1,166 Tks steel 660 lbs @ Tks 70/cwt 412 Tks TOTAL (Abutments) 9,253 Tks superstructure concret- ck 166 ft3 @ Tks 4.5 747 TKs 2 # 1Ks 7u0/ UWL. - 4U2 1KS Rail 1i4 Ib w L- 9 TSYi 26" 7cs 206 # @ Tks 70/cwt = 129 Tks TOTAL (superstructure) ;n484 Tks TOTAL FOR 10' BRIDGE 10,737 Tks CALL iO,700 TKs 20' (girder) bridge Abutments 9,253 Tks Superstructure Concrete deck 257 ft3 @ Tks 4.5 1,I56 Tks 2,301 # @ Tks 70/cwt - 1,438 Tks Rail 23 ft3 @ Tks 9 207 Tks 316 # @ Tks 70/cwt = i98 Tks TOTAL FOR 20 BRIDGE -1,252 Tks ChA.L I 1 ' cJ nl.s APPENDIX 1 Average cost of bridges and culverts 12,300 Iks 210,700 Tks = 11,500 Iks each On average l1.67 bridges and culverts are constructed per mile of new dirt road-'L giving a 4-talI cos. of -in ±/L* d1`JU t iLd hLi s-u-r± au roads are constructed on old dirt roads and thus require no bridge or c. u L vl U uonsJ tu tUC Uo10-. UIL.L C0- "AJ-L flUJ. 35,000 1KS eacn DI-Udo.UWH of LULL- t cosii.i usy lauor ana. mauerlar s. (iuriing is estimated vD be 60% labor and 40o materials) Tks/mile Labor Materials Enbankment ear h, Wor , 1 . turfing ,O'i7 678 TOTAL 6,56i 678 % labor 6,56i = 9l 7,239 Drains 3,880 0 % labor =100% Dirt (Kutcha) roads e a - t 1,&n V-% Ar In c-vv turfing 445 965 TOTAL i4,645 963 % labor =h 4,645 9 APPENDIX 1 Page 6 Labor Materials surfacea (nucca) roads (new) earthwork 7.392 turfing ',654 1,102 box-ing z640 metalling 11,551 18,067 bats Tks 85/,00 ft = 61 % breaking Tks ! 6/! 00 ft3 = 11% placing Tks 39/100 ft3 = 28% Sand I $11 ,-5-11 Edginv and soling 2,20" 19,843 bricks Tks 36/lOO ft3 = 90% laying ics 4/!0o ftA 10% TOTAL 26,953 40,523 % labor = 26,953 67,4'6 Bridges and culverts ,975 8,62r No specific data is available. Figures from performance report inaicate about 25% labor costs. APPENDIX_ UNIT COST BREAKDOWN OF FOREIGN EXCHANGE item un i Foreign txcnange Cost Tks/mi or Tks/Unit Txs/mi or Tks/unit Bnbaniments 7,200 0 0 Drains 3,900 0 0 Dirt Roads 15,600 0 0 Paved Roads, new 67,500 11 7,580 Bridges and culverts 11,500 7 770 APPENDIX I SUMMARY OF AVERAGE UNIT COSTS (By Labor & Materials) % Tks/mi or TJks/Unit (rounded) T ^bor sArial -Labor Materlal Tota-l Embankments 91 9 6,500 700 7,200 Drains 100 0 3,900 - 3,900 Dirt (Kutcha) roads 94 6 14,600 1,000 15,600 Paved (pucca) roads, new 40 60 27,000 40,500 67,500 Bridges and culverts 25 75 2,900 8,600 11,500 Dirt (Kutcha) roads, f-includinL bridees and culverts) 56 44 19,400 15,400 34,800 APPENDIX 2 Page i BANGLADESH - SECTOIR STUDY MAINTENANCE COST ESTIMATES Dirt Roads and EmTbankments Tks Per Mi Per Year Year snbankments Dirt Roads Labor Material Total Labor Material Total 1 1,;910 3hn0 2;25 4;00 qo L,500 2 955 1 70 1,125 20non 2,h0 7) 2q0 3 4~75 85 560 !,000 125 1,12'5 4 and afl h25 75 500 890 o n i000 years following Maintenance Costs Drains Labor Material Total Tks per mi per year 250 0 0 Maintenance Cost, New single -layer brick (,sin-.gl-e layrer bi, ;ck)~ Year Tks Per Mi Per Year Labor Itterial Total 1 2,-500 2,500 5,000 2 1,950 i,950 3,900 3 1,700 1,700 3,400 4 and all following years 1,600 1,600 3,200 Maintenance Cost (New Double Layer Brick) Labor Material Total 1st an(dA a.Ll IoJlowing years 1 1 g It is ass-L,edu th1iatCO rie-w d.ouble lU. ics rotadUs cl-e U.L.LL, over ol single layer brick, the road is therefore already fully compacted. APPENDIX 2 Pa ge 2 I C AVERAGE MAINTENANCE COSTS (For the Three Grad.es of Improved. Paved Roads) ins rer IL. er Year Year Labor Material Total 1 through 9 1,530 1,530 3,060 10 2,830 11320 ih,l50 -- - ,-n - , r'r -' r.Er ii tnrougn 19 150,530 3,wO 20 2,830 1,320 1h,]0 21 througn 29 1,530 1,530 3,060 Bridges and. Culverts Miaintenance costs are included, in roadway maintenance; structural maintenance would. be negligible in a 30-year period. RESTRIGTED INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION BANGLADESH LAND AND WATER RESOURCES SECTOR STUDY VOLUME VI RURAL DEVELOPMENT INSTITUTIONS TECHNICAL REPORT NO. 18 THE THANA IRRIGATION PROGRAM nAAnRmh.r 1 1Q79 Asia Pro,ecVs Denartment %RTfl.T.A1TVEU - 5T S'fTJY UATTTMTW 'IT - ,TTTWAT. n 1TW.T-n)PMW," TV.5'PTPrjTTI'TNg rPV'MtT %ATT'AT pDWDAUr1 VA 1N. 'PUt' 1'UAVA TDRCTr-A'PTAn 1DD,OAUl/ TABLE OF CONTENTS Page No. SUMMARY AND CONCLUSIONS .................... . i I. INTRODUCTION . ........... .... ........ 1 II. TIP OPERATING PROCEDURES . ......... .. ...... 1 III. INDICATIVE PAST PERFORMANCE ... . . . . . . . . . . . . . . 2 IV. TUBEWELL DESIGN AND CONSTRUCTION . . . . . . . . . . . . . . 7 Choice of.Design . . . . . . . . . . . . . . . . . . . 8 Capacity of T-ubewells. e*ssee*** 9 Choice of Drilling Method . . . . . . . . . . . . . . . 10 VI i,unsu,ructio1n .0............... . 10 Cost of Construction ... . . . . . . . . . . . . . . 10 Present Irrigation Practices . . . . . . . . . . . . . 12 Availability and Source of Materials . . . . . . . . . 12 Casing Pipe ..................... . i 3 Pumping Equipment .... . . . . . . . . . . . . . . . 13 List of Appendices A. Allocation of Responsibilities Under the TIP B. Bangladesh Agricultural Development Corporation C. TI-P Mn enance Requirements 1/ This Report was prepared by Mr. E.D. Hunting on the basis of drafts by an IDA mission led by Mr. P. Craig-Martin. CIT1KU .A nV AIMT 1ATTTI?T0Tr11'KTrC i. The Thana Irrigation Program began in 1966 as an extension of the Ill. I Work P.- g- - - Adl,nsee by '--- 1 A- the Lo^ -oewA=.n (LG Dep -t.,.ent,- --fT%'-4--4 it operated through the local Union and Thana Councils to promote the .LUViLJCUd.LV.LL VJ.L ±VIJL..dJ ±L.L--LVCti±IA1 Vi. tJu.iiAp .L-ULLjJb UL. CL. JjJ_L.I.tU L'V~JU I~.dI Development Corporation (ADC) for the rental of low-lift pumps or tubewells On e Ubasis Vo. appoveU irrigatiUL1 plans. MU1 ±rr-giorV1L raVLLp U.1iLULLUrLVu as a primary cooperative society and affiliated with a secondary cooperative society, either a Thana Central Cooperative Association Or a Cooperati-ve Central Bank. ii. Since 1966, the irrigated area roughly doubled to more than 700,000 acres under the TI-P, bringing almost two-tnirdus of the area under improvea seed varieties. At the same time. the program developed the initiative of the farmer (who has been willing to pay for water), and togetner witn the RWP proved the feasibility of a program that depends on responsibility at the local level. Inevitably, there were operational problems - pumps, tube- wells, and water supply were underutilized, schemes were drawn up usuall;y without technical assistance, provisions for long-range technical planning were inadequate, pump rentals were frequently, not paid on schedule, main- tenance and tecnnical and managerial training were poor. Also, questions arose over types of equipment to be provided, particularly as the program expanded to include groundwater irrigation. iii. To increase the effectiveness of TIP, six suggestions follow: (1) The possibilities of increasing the number of hours of irrigation each day should be explored; including scheduled operation of units, improved distribution; and greater incentives; (2) Provision should be made for regular technical assistance in the field in support of the irrigation extension workers; staff might logically be part of a unit under ADC or WAPDA with specific responsibilities for the support and planning needed for a program such as the TIP; (3) Responsibility should be clearly designated for long-range technical planning to coordinate TIP schemes in overall water resource planning; this might logically be delegateci to a unit under ADC or WAPDA; (4) Basic records on the operation and maintenance of all pumps should be established and maintained. To facilitate! planning, the records should include data on haurs of operation, water flow, and actual irrigated acreage. - ii - (5) Pump drivers should be recruited from members of pump groups rather than ADC employees, and provided with proper training; (6) Pump and tubewell rental charges in areas where demand has grown and water supply is limited should increase at a faster rate than in the past to encourage pump groups to use full amount of water available and to expand their service areas. BANGUDESH - SECfTO iRUuz VOULUME V.L - REMIAL D EMVr1OPP7' r±iSrTLTUTIONS TECnMICAL REORT 'NO. 80 THE Th-ANA IRRWIGATUN PRWG.M I. INTRODUCTION 1.01 In 1966, following experiments in Comilla Kotwali Thana by the Academy for Rural Development a new infrastructure development program called the Thana Irrigation Program was started as an extension of the Rural Works Program (Technical Report No. 17). The two programs, RWP and TIP, became known as the Expanded Rural Works Program (ERWP). They were both administered together as ERWP by the Local Government (LG) Department. 1.02 Irrigation is well recognized as an economic proposition for many farmers but three-quarters to four-fifths of farmers in Bangladesh have small fragmented plots and the only way in which they can obtain the benefits of irrigation is to form a cooperative group. By forming such groups,they are in a position to request a low-lift pump or tube- well through the TIP, which passes the request to BADC for implementation. BADC is responsible for deciding if the conditions of flooding, ground- water availability and suitability are satisfactory and for siting the pump or tubewell; it must also find acceptable the irrigation distributLon system proposed by the group, without insisting on any special system. The group, being a primary, cooperative society needs to affiliate with a Thana Central Cooperative Association or a Cooperative Central Bank. Each group has a manager and a model farmer who receive training in water management and modern agricultural practices under TIP at Thana Training and Development Centers. II. TIP OPERATING PROCEDURES 2.01 Proposals for irrigation works are elicited from the local leveil by union council members and are combined into a thana plan along with rural works proposals. After the irrigation proposals are approved by the thana council ,they are referred to a district approving authority, a tech- nical body. As with the Rural Works Program,all plans must be witnin the yearly LG budget allocations for irrigation works. This annual plan- ning is done within the framework of five-year irrigation plans drawn up and maintained at thana level. The division of responsibilities and duties of each organization involved in the Thana Irrigation Program are contained in Appendixl to this annex. 2.02 The Agricultural Development Corporation (ADC) is the principal organization responsible for the implementation of the Thana Irrigation Program; its duties and responsibilities are contained in Appendix 2 to this report. The ADC Thana Irrigation Officer is its principal officer responsible for implementing the TIP at thana level under the general supervision of the Circle Officer (Development). - 2 - III. INDICATIVE PAST PERFORMANCE 3.01 The initial emphasis of the Thana Irrigation Program has been on low lift-pumps rather than on more expensive tubewell investments. As the opportunities for small scale surface water irrigation are gradually being exploited, TIP is turning its attention to groundwater. The estimated TIP irrigated acreage grew from 321,000 in 1967/68 to 711,000 acres in 1969/70. Further, the proportion of irrigated area under IRRI and other improved high yielding varieties rose from 38% in 1968/69 to 63% in 1969/70. Estimated TIP boro production was 1 million tons of paddy in the 1969/70 season and it is calculated that, in the same season, the TIP created about 42 million man-days of employment. 3.02 The achievements have thus been impressive; Bangladesh, a food deficient country, has experienced a large increase in rice production due to the impetus created by the program. It has also shown the potentialities of a decentralized approach relying on village level project identification and execution. Given the scarcity of administrative resources prevailing in Bangladesh, it is doubtful whether an irrigation effort administered in the traditional centralized manner could have met with such success. 3.03 The program also represented an advance in another area. Previously, great difficulty had been experienced in collecting payment for irrigation water. But, under the TIP no pump was supplied until a year's rental in advance was paid; although the rental charge, 350 Rs per 2-cusec pump per season, did not meet the investment costs of low-lift pumping and tubewell irrigation, the program established that small farmers in Bangladesh are willing to pay for water. 3.OL DesDite past achievements, some difficulties remained in oDeration of the program. Major factors which are discussed below include the following: (1) Pumps, tubewells, and the supply of available water were seriouslv underutilized: (2) Trrigation schemes were drawn un in most cases without the benefit of technical assistance in the field needed for pronper designs of distrihution laymtts, and c,hannel imnronve- ments and effective schedules for pump and outlet operation; (3) The Program Manual did not clearly designate responsibilities r.or adequatelY provid-e for1 1loneg-range te-c--nMiecal pla-n-gr to coordinate small-scale irrigation schemes within the framework of the overall -ro-ram.s for wat-er resource development ar.d tor assist in administrating water rights between competing (l\ nv%a,.n+innr,- ciffwa" fwnr"rm inmAamini+o ~ .a (4)fo peatol t snfferenad weroe. anot uala carerie out- properly for collecting rentals were not always carried out properly. 3.05 The efficiency with which pump groups have utilized low-lift pumps ar.u tubue-wells prov-LdUed urL,±der Wle TIEDP Maos beer1.0loW. UVer O..L.Lj a two-cusec pump or tubewell has irrigated on the average 30 to 40 acret, --'en it cou' CO" rS-gate over '20 acres ofP boro- reei utiliedf_'3 y WI~L± .1 U UVULU ±.LJ.L-L~ Lo U ± LCAJ IJJ LIJ LLJ J . LL W-AZV ± UJl4j . The main reason for this appears to be the low number of hours pumping per da-y. ADJj.C repor-e d Jun 1.767 ULU pw-ps w-ere used for an average of only about 6 hours per day, thus utilizing only about 25% of the avail- abule -watt'ero vu rsLLJL m: _ : ±U _ u i _I _. LLLU.L jJV __L1U±0.±_. J _ irrigation under this type of program exists in addition to the potential r-e£a1LuIlg LroL w1uexplo-ited so-urces of wadlreS VV.L LIUUoU divU.L1g adUU±LtviLc&l flow from the rivers, irrigation provided for as long as, say 14 hours per day would, in tast case, use as much as 60% Of the supply available. ADC, even within the range of distribution it has achieved previously, could further increase tihe area served from available surface flows under even longer hours. 'Where pumping is done from standing water bodies and from groundwater reservoirs, the resource generai±y couid noti be exploited further by longer pumping hours, since theoretically, there is effectively no upper limit on the rate of pumping, and, therefore, tne limit is deter- mined only by the total volume pumped from the reserve and the annual recharge. However, in cases where additional well units or pump capacity cannot be obtained for reasons such as procurement or installation difficulties, these existing resources also could be further exploited by longer operation. 3.07 Some reasons that groups have not improved utilization of their units are the following: (1) water supply is adequate at some sites and there is yet no pressure to enlarge the existing group or groups; (2) A low pump rental charge which orovides little incentivel to enlarge the service areas of the pumps and the size of the groups; (3) Inadequate technical planning and review of irrigation layouts; (4j Insufficient irrigation extension and inadequate training for the pump groups. 1/ Although irrigation duty for a rated 2-cusec unit of 40 acres on about 6 hours daily supply appears quite good, in most cases actual water use is less efficient since actual capacity of the pumps often exceeds the rated capacity. The average pump is rated for 2-cusecs at pumping heads over 30 feet, but the average pumping heads encountered were between 5 and 10 feet. - 4 - In many cases farmers outside the original groups are blocked from the supply which, with well-organized use of the pumps and existing channels, could reach their fields. without irrigation officers in the field who are aware of,and can demonstrate,the possibilities for wider distribution; the farmers outside may resign themselves to the potential of their holdings as they see it, and there would be very little pressure for the existing pump groups to enlarge for a new group to form in an area al- ready served. Incentive to expand the service area, therefore, will depend on active technical assistance in the field. Consequently, improved utilization cannot be motivated by higher pump charges alone. To have a positive impact, the increased rental must follow a growth in demand in locations where no further supply is available. 3.08 Better use of the water supply under greater demand and possibly resulting from higher pump charges could be achieved simply by staggered operation of several pumps drawing from the same supply and by rotating duty for single units. However, to improve water use poses these questions: (1) Could pump groups be motivated to adopt longer hours of operation? (2) Would farmers be willing to cooperate in larger groups and to adopt schedules for sharing pump units and distribution networks? (3) Would larger pump groups be less effective under a program such as TIP? (4) Could water be distributed further than the present average 1½ to 1 mile inland without more extensive engineering than the minor channel improvements and scattered multiple-pumninR previously implemented bv ADC? Trial and error in the field and detailed study of these questions could help to unlock the large additional potential for the low lift pump operaton. A combined study involving the Academny for Rural Development, ADC and the Agricultural Research and Ectension Services may be needed. 3.og The philosophy of the program was not to enforce any special distribution system on the groups but to accept a group's proposal for a distribution system if it was reasonably satisfactory. ADC was primarily concerned at the time with forming new pump groups and increa sing the number of pumps fielded under the program. The expansion over the last 10 years took place with very little improvement in irrigation prac- tices and without increase in the average size of irrigation groups, and, as a result, the overall average efficiency of pump use declined from a high of about 76 acres per 2-cusec unit to the present average of 40 acres per 2-cusec unit. ADC's responsibility under the TIP was not defined clearly to include the engineering review needed to ensure effective use of pumps and limited supplies of water. 3.10 However, the need became evident in the first year of the Thana L.L Jr .'J1. L r r.L'JJ~I - .LJ. VL LML UVJ.AL kJ.LCM4LLLLLL6 t;V OL .LI, %- &LL.LLO%r .L.L_.L.LtjO. U.LV.'AI, and related embankments and roads. Accordingly, the Thana Irrigation Maps 4-sc,-4 4-.n4-A n. n+ nrn'-* 4-f -c,, 4-4- …. 4 U were 4.sUtitu e - U LMALaW .I&A "VU.,aLv:jor.L& .L rVesoces andI schL.emes at the thana level for technical assistance and approval by WAPDA and the .Ln Depar4J.ent.L V .Although this VK7nge en was neverLIJ11 Uq t iILVL&LS e before,! .to exploit the great potential for small-scale irrigation it shou.. Ide acvae - ,the,44 4it. 4.4. iPs -1ge d I .-_' -1 i-, _4_ V.LV£ LL UVk* X "WWI L , L O OL466CY0 L*V%A U11 V .LU .t7 ML ±.LJ..L6C6 . UIJi engineers and technical extension personnel assist at the thana level in culture officers, and in administration of water rights. Technical aassistoance also sbould exter, --- supportL A.- r ox f -r na lev,el ~ LI1~~ O~LU A&V'U.LU4 t:; L.t7LU L. OUppUJ. L, Ld1'V (1-C.rLjLUg 0-. niLI4 .LW ~L officers, the proper organization of maintenance facilities, and the creation of operation-al manuals for -va-ous aspects of the progra . Such a staff might logically be part of a unit under WAPDA or ADC which would reV-V1ew 4the 71hrlana I-rrigation r-,ais and also pr-ovde -- -lenee ol---g technical planning. 3.11 The primary extension system fostered by the TIP is based on the trainLUg of group maniagers alld selected modisi farmers from each group at the thana training and development centers (TTDC). The thana irrigation and agricult-ural oficers (kTO and TAO) are thie chief trainers and are responsible for organizing the weekly classes. However, although most of these C officers hlud a LVertily udgree, they were given no instruction on how to conduct such training courses. There were a number of agencies producing extension material in Bangladesh but most TAO's did not receive it. Apart from a few thanas which set up demonstration plots at the TTDu s ana convenient villages, TIP trainlng appeared to be purely academic. Unless TIP training is given more practical orientat-ion and TAO's are given both instruction in fanmer training and access to training materials, this system of agricultural extension may have little prospect of becoming more effective. 1/ After the program in ten pilot thanas was expanded for the country in 1967/6O, ADO reported that only 32% of thanas surveyed had obtained approval by WAPDA engineers in 1967/68. - 6 - 3.12 Although pumD rentals were supposed to be paid in advance there have been instances where pumps were supplied to irrigation groups with- out pavment being made. Pumn maintenance, which was an ADG respon- sibility was inadequate. It is impossible to locate accurate figures as to the exact extent of this problem but there were apparently a large number of cases in which low-lift pumps were inoperable owing to mechanical faults. The fact that a large number of low-lift pumps have now been in operation for several seasons and will require increasing attention and also the added resonsibilitv of tubewell irrigation is bound to exacerbate this problem. Causes for inadequate maintenance appear to be the following: (i) The ADC mechanics have had limited training and exnerienG-e. (ii) The ATDG mechanics lack transport facilities and equipment to respond to calls for minor repairs niwi rklv and to narrv out rou+tine nrAvPntativre maintenance. (iii) Thana and district level workshops lack capable merhani rs sndi eni ri nmpnt t-+o -arrv- out the renair-s. 3.13 Althnounh it is a TTP reqnuirement that tha pu mp operatnr shonul d he recruited from among the pump group, this requirement has not been enforced; only an estimatedj hO of the p umn diver.s are frnm local villages. This resulted in some of the following difficulties: (i) Some groups have been delayed in commencing irrigation ^T.r4n +J^ -horva of pYWfp 7r (ii) T.he 4'ver as an. em.ployee of ADC rather than the group has little incentive to work efficiently for the group, par ticularly nv1 r crr.ectin-4on vs4 +1- pn,nnn. care.. (ii) Since onl+y one dri-ver is supplied to each group, pumps are only operated part of the day, making for inefficient use op P.M. facilP, t 1 e 4 L4J'~~~~ ~~~J.L 39U.~~~~L L 9L LJ. . A .JJ. U -7- 3.14 The ADC, througnl its Own 1fnala lUVel fLfica.J, dealer-s and TCCA's, distributes fertilizer and seeds in Bangladesh (Appendix B). Pesticides are distributed by the DeparuLtnt of A6L '.Lture&L V%AAit Thana Plant Protection Officer. The prices of fertilizer and seeds are subsidized but in spite of this, shortcomings in the availabili y of credit have prevented some farmers from taking advantage of these facilities. Inadequate storage facilities in some t4hanas hazve also impaired the smooth operation of the distribution system with the results that actual distribution has tended to fall behind planed targets.- Suggestions for expanded fertilizer distribution and plant protection services are described in Tecnnical Reports mos. 'L4 anu 1 respectively TV_ TURMIFtT.T. nTh.sTrmN ANI n1N'TRWrnTTOM 4.01 Many of the irrigation tubewells now in use have been constructed by hand-boring methods - either percussion or jetting - as a 10" to 121" bore hole to the depth necessary to accommodate 120' of screen. While jetting is more rapid than percussion as used in Bangladesh direction and size of the hole are much more closely controlled in percussion drilling. Six-inch brass screen is most common, with either mild stee:L or galvanized steel pipe for blank. Gravel is installed only around the screened section. In all of the older wells,the entire well was constructed of 6" casing. Recently, ADC-TIP wells are being constructed for the most Dart with "expanded tops", with 12 or 14-inch pipe in the upper 60 feet to accommodate deep well turbine pumps. Wlere present water levels and draw- downs permit, centrifugal pumps are installed. 4.02 W4ell develoDment is carried out either by over Dumning and back- washing or by use of compressed air. Despite the claims of the drilling authorities for full development using compressed air, it is doubtful that this is correct. The ADC placed a minimum discharge of 1.5 cusec on acceptable wells, with contractor's penalty of Rs 2500 per .25 cusec below 2.0 cusec. Even with this requirement, however, few of the tubewells are apparently discharging up to design. In the Comilla-Kotwali area. most installations are said to yield 1.0-1.3 cusecs. Lack of reliable discharge and water level measurements render a proper explanation impossible. It seems most likely that pumping levels are lower than believed, and fall even farther as the dry pumping season progresses. - 0- 4.03 A pump house of masonry and reinforced concrete is constructed at each well. Discharge is thro-ugh a flexible hose to sume conveyance outside the house. Choice of Design 4.04 The main constraint in pump selection is the water level in Ve.Lau±Luli iu LIAI aurlace. Cuxinrifugal pumpu are el.Lcienb with pwiriping levels of 15 to a maximum of about 20 feet below the pump intake. Turbine pumps are rm-ost efficient at lifts of 35 to 4u feet and more. 4.05) 'wnmile data on pump-ing drawdowns in the existing ADC-TiP wells are lacking or unreliable, six to seven feet drawdown per cusec o f discharge would be as little as could be expected. Therefore, where the static level is more than 8 to 10 feet below the pump level, centrifugal pumps cannot be expected to yieid their design discharge, even if as low as one cusec. Static levels on drilling reports in Kotwali Thana average about 12 feet. With annual water level variations as they are, and likely to increase with greater use of pumps, even four to six feet at the end of the rainy season may be too low. The results oI using centrii- ugal pumps under such conditions are: (i) initial yield may be low; (ii) as the ury season progresses, the water table drops farther, and the pump discharge decreases further. The low acreage irrigated per tubewell in the project area is believed to be due in part to these reasons. 4.06 Insufficient studies have been made to properly estimate the ultimate effect on the water table of extensive groundwater development. It ap- pears that a large volume of pumping is possible wvithin tne safe yield, but general static levels at the end of the pumping season will probably decline considerably more than at present. A tUbewell designed for use witn a turbine pump may be used with either type, while one designed for centrifugal is not usaole for turbine. Whereas it is feasible in some environments to lower a centrifugal pump into a pit when the water drops, this is not practical in an area of 90-100 inches of rain and/or overland flooding. 4.07 it is therefore suggested that the tuTbewells be dlesigned for turbine pumps. In some cases, where water levels and specific capacities are high, they may be designed for centrifugals initially to cut capital cost but capable of using a turbine in the future. Design for turbine pump then dictates the use of "expanded top", or pump housing casing, in the upper 50-60 feet of the well. For 2-cusec discharge, 6" well casing and screen is sufficient. Eighty feet of screen is ideal for the aquifer conditions and utilization factors expected for the installation, but in a properly con- structed well, 60 to 70 feet would be sufficient. Choice of casing is governed by the factors: corrosiveness of the water; hydraulic efficiency; cost; ease of handling; availability. Mild steel is rendered unsuitable for Bangladesh because of corrosion. Rope-wound (coir) screen is not manu- factured in Bangladesh. a trial well in the past was termed a "failure", but no details were available; poor well hydraulics makes operation expensive. Brass, fiberglass and polyvinyl chloride (PVC) appear to be suitable. - 9 = 4.08 Brass is subject to electrolytic corrosion under the normal practice in Bangladesh but can be used with proper design. All should be similar in hydraulic characteristics; PVC is most difficult to handle, fiberglass the simplest. Wnile PVC cannot be recommended for large projects when extensive stocks must be stored in a hot climate and where speed is essential, for individual wells it should be suitable. 4.09 Estimated market and handling costs per foot of 6;' slotted casing are: Type Market Cost Est. Handling Total 9 7.20 @ 1u.u Fiberglass $7.25 Tcs 4 Txics 56 77 Brass Tks 50 Tcs 5 Tics 55.0 65.0o* PVC Tks 16 Tks 9 Tks 25.0 2z5.0 * 20% of market cost considered foreign exchange. PVC is then considerably cheaper, and although it has not yet been used in Bangladesh, it should be usable on an individual well basis where it can be handled carefully and time of installation is not critical. A suitable method to attach the PVC to steel casingwould have to be devised. 4.10 In view of the price differential between fiberglass and PVC and the fact that PVC is manufactured locally, it is suggested that PVC casing be tried on some of the tubewells. Since it is a new use of the product and a number of techniques need development, the installation should be made under careful supervision. The Kotwali TCCA has a great deal of experience in general techniques; it is suggested that 10 wells in that Thana be used as PVC experimental installations. Fiberglass should be generally used for reasons of low cost and ease of installation. Capacity of Tubewells 4.11 Two-cusecs has been chosen as the standard capacity for tubewells in BRangladesh rvrimiarilv bAeanuse this onan-titv- is snffi-rrint WatPr to properly irrigate the holdings of 50-60 farmers, the number which appears on hb ahnbt thA maximnm fnr oopnAratlve groups. 10- Choice of Drillina Method JL.12 .Ssvpral methods of "thnndrl dlrillino nre. now in uise in Bannglandah- percussion, percussion-jetting, and rotary-jetting. While percussion is nprhans silghtly more exnPn;ive and slnwer, a bhpettr uell shoild result. Reverse rotary drilling is quicker which could have some advantages, con- strimts better and moTr offiAnint wells, and according to recennt contracts in Banagladesh is competitive in cost. However, because of the scattered nature of the work nnd bhPr-ec e mnll cont.ractors without mPrinhnnized enii- ment may be used, hand drilling methods may be preferable; further it would encouirnag the growh of a i well driling capaci+y in Bangladesh. It is perfectly possible with proper supervision of hand lrpercusslon drillina ton ohbtin trhe vertic(aln1 hnleoc es fonr fitr'hlne pumps. However, in view of the fact that both hand percussion and reverse rt ry drillingr appea-r sMatisfactory it does~ ~notse a necsar oexld reverse rotary drilling under the project. Means of Construction 4.13 There are two general means to achieve construction of tubewells: force account by AD_, (organized by the T0 at thana level) or private contractors. The ADC presently has 80 drilling units, but only 30 are opeatve- --f to lack of -- nductor p The i.imhbe of contractors ----- able in Bangladesh is not known. There are four large drilling firms, and a+t leas+ +ten+tr cmall ones. A -recen+ ADC co+'n.-,+ fo, Ann0 twellc d.vi A er;rl among 17 contractors, of which 14 were small, hand boring operations. Cost of Construction .14 Estimates of actual contract costs of similar tubewells in Bangla- desh' vrcnirb Following is a t-auat-ion of several contracts and estimates, less pump and engine,, but including installation of equipment. - 11 - Size Hole Length T.yIpe Casing Size Screen Cost . um Name Casing (inches) (inches) (feet) (Tcs) rype ADC-schedule of rates S-Br 12-6 16(?) 120 40,500 T ADC-contractli S-Br 14-6 18 120 43,900 T ADC-contract (Yugos- lav bal-t-) S-Fg I4-U 22 120 L, Tvu_ M^^la CA I oN 6 10- IOn n 120 2,0/ A A £ , _ __ A__ ADUC-iA loan Appi. (contractor) S-Fg 14-8 22 120 40,900 T ADC-IDA Loan Appl. (AD C) rg u .L'- 14 120U 27,CUU C T ^ ^ __ . n 1 n >, O o n n o 5 n 0 ' I iDA Appralsal Jpt. S-Fg 4 -8 22 12 0 33, UU T S - Steel T - Turbine Br - Brass C - Centrifugal Fg - Fiberglass / Both reverse rotary and indigenous tehcniques. /2 Assumes Tkg 11,500 for pump and driver and 15% for barter premium as deductions from lump sum of Tks 67,000. /J Billings range from.1icks l9, 00 to T-cs 35,000, but ADC pays Tics 20,0(0 maximum. 4.15 Unit prices obtained varied considerably: 6" Brass strainer - Tks 50, 48, 42, 65 drilling, per foot - Tks 60, 15, 45 gravel per foot - Tks 3, 4), 6 but some unit prices have been arrived at quite artificially, that is, by unbalancing unit costs to arrive at a given lump sum in such a fashion ELs to ensure higher returns in the early part of the contract. - 12 - Present Irrigation Practices 4.16 The farmers in Bangladesh have only recently been introduced to irrigated agriculture and this in part is probably responsible for the fact, already described that water is not used to full efficiency and that pumping equipment is underutilized. Whereas 2-cusec should be sufficient water to irrigate about 120 acres of boro rice, the crop with the highest irrigation requirement, the average 2-cusec tubewell pump in the Comilla area irrigates onlv 50 acres (the range is from one to 77). The pumps are operated only 10 to 12 hours a day, immediately reducing by half the irrigable acreage per pump. Pumps often discharge directly into the village tank or pond rather than into conveyance channels. Considerable losses must occur in this method owing to increasing evaporation area and seepage; however, they do yield supplementary benefits in the form of domestic water suDplies and fish production. 4.17 Field ditches are minimal, plot-to-plot irrigation being the common irrigation method. This results in heavier application than required near the head of the svstem and on the lower plots, while the peripheral areas and higher fields receive slow and lighter supplies. Irrigation of crons other than rice is made difficult. If sufficient water were made available,it seems certain that the irrigated area per pump could virtually double. This easilv could be accomplished by Drolonged pumDing into a proper conveyance system to carry water quickly away from the discharge point to the outlving fields. Conseauentlv. emohasis may be needed on the water distribution system to get water on the fields more quickly and iyith less waste= Tnrnd levellino, in individinal hasins may also be imnortant to raise farm irrigation efficiency. Detailed study of a buried pipe or Alevatted nr-ndzniit qs7rt.m of rnnveyanee mi oht indicate a favorable return particularly considering the extreme pressure on land in Bangladesh. Dis- n.harge pnints tan he nlated at a distanne from the well, thereby allowing more land to be broughtunder irrigation than is now practiced with plot- to-nlnt flnw. Ei+heAr method allnws nearlv cnmnlete cniltivatinn as n-,m- pared to ditches. 4.18 The obvious first step to be considered, however, to more fully utilize t}ha pu"nning capacity is to invastigAate t ha fPasihilt +n igr-ioniatae 24 hours per day during the periods in which Deak water requirements occur. Based on boro rrim ga+ton req4irements, highest u-+iz2n +A n may be required between January and April, with peak requirement varying through- out +the cof-nt.-y¶,- - abont Jarn-.r a in Com"illa, Ch4 ++ong a Man h_._Ap_1i .... …~~~~~....J ~ ~ ..it*_ew%et- *f ?An"S AvvS in the Northwest of the country. Availability and Source of Materials 4.19 Drilling Rigs. For percussion drilling, equipment could be fabricat-ed locally,1g~. but mc,i otms,o +e"eil utb imported. Long lengths of good quality pipe are not fabricated in Bangla- de-h. Rev-rse rota7 y rievs ^P VWi --+h be 4 orted or fabr ted. fr la r1g imported materials. A small rig mounted on a farm tractor has been developed 4- Bargla-sh -L4- -is - quit r.bi-ard 'kle of A-411'4g 200n &- neA reet4 J.l- LA LAI.AL ~ L LLL.LQ -LO I .4A.L UV JII%JU..LJ.L ~L1UA %;h-J~LJQS . 5 5L U.Lj.j..Lj.L&r~' J*.J IAJ C.)5Jv .J. LO without difficulty. Jetting equipment is fabricated locally with some im-Aorted comm-onent-s. - 13 - 4.20. Casing Pipe. Steel pipe in larger sizes is not available from locally rolled sheet. Four or eight-foot lengths are welded together to make longer lengths, an unsatisfactory procedure in the absence of excellent workmanship. PVC pipe is manufactured in at least smaller sizes in Bangladesh. If larger sizes (14-16") were available, savings could undoubtedly be effected in its use as pump housing casing. Fiber- glass pipe is not presently manufactured in Bangladesh. Several companies have expressed interest in establishing a plant, but none has come to fruition. Some brass sheet is fabricated locally but except for available scrap, the brass must be imported. 4.21 Pumping Equipment. Turbine pumps are manufactured in Bangladesh by KSB Pump Company. While presently the KSB concentrates on centrifugal pumps, turbine production could be expanded if necessary. Most of the components for turbines are imported; casting and machining are carried out locally. No diesel engines are now fabricated in Bangladesh; presenit suppliers are England, Germany, and Russia. Gravel is derived from Sylhlet. APPENDIX A. BANGLADESH - SECTOR STUDY ALLOCATION OF RESPONSIBILITIES UNDER THE TIP (A) Union Council and Ward and Local Agricultural Committee 1. Organize irrigation or pump groups; 2. Provide Union Council members to serve as ex-officio chairman of irrigation groups; and 3. Map the ward and union for irrigation potential. (B) Irrigation or Pump Group 1. Organize the distribution of irrigation water; 2. Excavate field channels; and 3. Collect charges from individual farmers and pay to the Thana Council. (C) Thana Council 1. Give technical and mechanical support; 2. Construct housing, workshops and offices for the Thana Training and Development Center (TTDC); 3. Organize services and supplies; 4. Collect charges from irrigation groups and deposit them in the Thana Irrigation Fund; 5. Pay for services of ADC and WAPDA; and 6. Map the irrigation potential of the thana. (D) kW 1. Provide a Thana Trrigation f'fcer to assi9t the Thana Council with irrigation development; 2. a ive technical and managerial training to managing committees, managers nnd drivers; 3. Provide lnw lift pumps/tubewells (whee a l n-w-,,ber are not required in a concentrated area); 4. Provide mechanics and maintenance supplies; 5. Provide or arrange for supplies of fuel, fertilizer and tro ha I ^I-±gatiorL F-und for low lift pump and tubewell operation. APPENDIX A Page 2 (E) WAPDA 1. Examine the thana irrigation maps and give suggestions for improvement; 2. Provide water, where appropriate, through concentrated groups of tubewells; 3. Provide electric power for tubewells, where appropriate; 4. Operate highly technical facilities such as power-houses, large regulators and big pumps; and 5. Accept payment for services from Thana Irrigation Fund. (F) Agriculture Directorate 1. Give training at the TTDUC and union on irrigation, seeds and plant protection; 2. Supply technical assistance in organizing irrigation groups; 3. Provide field supervision and assistance through the Union Agricultural Assistants; 4. Provide pesticides to the irrigation groups; and Furnish means to control insects and plant diseases where these are beyond capabilities of irrigation groups. (G) Academv for Rural Developzmnt, Comilla 1. Assist in the preparation of training materials; and 2. Conduct courses in training methods and, at the reauest of departments and agencies, in technical subjects. (H) District Approving Authority 1. Ensure that procedures have been correctly followed, and 2. Settle problems between thanas, particularly on water alloc1ati ons= APPENDIX B BANGLADESH - SECTOR STUDY BANGLADESH AGRICULTURAL DEVELOPMENT CORPORATION lae Dang.Lades3 AgrlCCU±aUJra1 Development uorporation BAIjU fornerJ.y East Pakistan Agricultural Development Corporation (EPADC) is an agency of '-se Banlgladesh oUvernment, estaoUisned in i961. It is administered by a. board of not more than five Government appointed directors. Government appoijnts one of ine Directors to be cnairman and chief executive. Thne Corporation operates under the auspicies of the Department of Agriculture and TAne Secretary for Agriculture is one of the directors. Tle Corporation has powers to act independently of government procedlures in ca.rying out its Pinc.tnons, in all mftters excent matters of policy, audit and accounts which are directed by the Gover"nmen.t. It has po.v.rs to -rnc-it Staff ndAer it-S nwn conditThns of service and possesses disciplinary powers defined by its own regulations. Mfls X o. r - ;m r 4niiew.+4 rtvn 4 oa nP11 +.irnn'nn7rt+ +.nt-rp nnd 4jJ, * - jJJ 4*j.J ^- -_ r- - - - distribute to farmers supplies of agricultural inputs including seeds, fe-tilize-s, pla4n prtetion c ..,l a ".d ar,ct4 mot-hinaynr Qnfi f.L bJ . J LZtV.L Q, jJ.J.L~MIV '.LAL~ .'A -~-t------ ~' L.,. equipment. To do this, it has powers to promote the setting up of co- operativeg~ Qr.4 so+et +hvrt,o1 r.1.hic ditibtior. to, f rmn-rqs is R nvmn.lly made. It is also empowered to take over and manage government-owned seed multiplication and livestock breeding farms and fruit busin.sses on terms laid down by government; it may promote the manufacture of - .nrrvrv.r arrw nil +,.n1-l r.acoV newry but memr not 4 + aof ,,v,Aor.+> suchai manufacture. Its most important secondary function is to promote the develop- ment of rlgation r. Banglardesih hy organi zing the siunly, ynnint±nnnre and operation of low-lift pumps and tubewells. It has adequate powers to APPENDIX B Page 2 execute this function. In designated project areas it may also undertake a complete range of agricultural development functions, including research, extension, marketing and the provision of credit. Finance The Corporation derives its funds from: (a) grants and loans from Government; (b) grants from local authorities; (c) proceeds of sales of Government bonds; (d) loans sanctioned by Governments; (e) development fees it levies on beneficiaries of its projects; and (f) other fees and charges (including tubewell rental charges) sanctioned by-Government in BADC project areas. Its annual budget is subject to the approval of the Government. Audit of Accounts The Corporation's accounts, which must be maintained in a form prescribed Government, are subject to annual audit by auditors appointed bv Government. APPENDIX C BANGLADESH - SECTOR STUDY TIP MAINTENANCE REQUIREMENTs.L/ Maintenance may prove to be the greatest problem in successful pump irrigation although those in the organizations entrusted with the task profess satisfaction with the present state of maintenance. The greatest needs appear to be: (a) trained mechanics; (b) eauipment and transport for the mechanics; (c) spare parts; and (d) major repair facilities. It is doubtful that a complete maintenance program should be attempted at the Tnana level. Duplication of equipment stores and training might result. Likewise, a maintenance organization separated into surface water pumps and groundwater pumps might be an expensive and talent-wasting exercise. Rather, one organization should be considered to administer the entire operation and maintenance program, at least to the equipment operator's level. While actual numbers of personnel and locations of some facilities may depend upon workload and ease of communication, a general organization is suggested. It may be advantageous for the equipment operator to be a member of the pump group, but his duties may have to be technically super- vised by trained circulating mechanics, each of whom would be responsible for a specified number of surface and groundwater pumps. The operator is not qualified to make adjustments or repairs to the machinery. His duties should be to keep the equipment fueled and oiled, to keep the installation cleaned, to start and stop the engine, and to report problems to the circulating mechanic or Thana maintenance office. The most important level of m2intenance during the early years of pwnp Installation may be preventa+ve maintenance. A trained mec-anics .-y n.eeA 4 circulate around a specified group of installations, so that he visits each grnu no less than once every 10 dayis. _e1yrote nml, of supplies and tools to make oil changes, minor repairs and adjustments. It may be advisable for an equipnment report crd tobe filled out on eaah Ti-a+, describing problems encountered, actions taken, and recommendations. The circulating mechanic may best be "based" at a Thana headquarters or centrally -located area ilf tn'O or mrore Thar,aMs ar._ cor.bir.eCd for m,aintena&nce purposes. Although no Thana workshop as such is probably required until the r."1Mbe ofpm nstallations grows large, equip,,lentl fCor p ''.g pmps - 1/ Preliminary dijcussions were held with the consultants to ADC under 3,000 Tubewells Project, 1970, on maintenance and repairs so as to extend the system they were introducing to an, TIP areas. Further discussions should be heldto ensure uniformity and precision. APPENDIX C Page 2 A frames, chain hoists, chain tongs, wrenches, etc., may have to be available for use of the installation crews. The amount of equipmentwould depend on the number of installations. The next level of maintenance should be handled by district workshops where first stage repairs requiring movement of the equipment, such as minor overhauls (valves, piston rings, etc.) could be carried out. Vehicle maintenance could also be carried out in these shops. Pump repairs should be minimal during the first few years of use, and it might be more economical to have rate contracts with private shops (preferably the manufacturer) than to eauip a shop and train personnel. Regional workshops exist on paper for the TIP. Thesemay have to be activated, equipped and strengthened. Regional workshops would he responsible for major overhauls of engines, major pump repairs (when the workload makes it economical) and major vehicular maintenance for several districts. Five regional shops may be sufficient for the country as major repair work can be scheduled throughout the entire year. Emergency repairs may not be necessary if sufficient spares and stand-by units are available. Equipment Required for Maintenance At the circulating mechanic level, the necessary tools and sup- nlies are smnIl and could nrobablv be carried on a scooter if four-wheeled vehicles are not available. Jeeps or Land Rovers would be preferable, however. It is suggested that each mechanic should narry- a tool hor containing: a) Hand lbols 1. Box end wrenches as required 2. Open end wrenches as required 3. Screw Drivers 4. Ball peen hammer 5. Punch set (3) 6. Chisel set (2) 7. Allen wrenches 8. Wire brush 9. Fine wire for exploring passage way 1O. Cleaning rags b) Adjustment Tools 1. Tachometer 2. Feeler gauge 3. 3mall level 4. Straight edge APPENDIX C age c) Supplies 1. Two reconditioned injectors 2. .."o fiber (4scs u Uo conn.ect mot toI J O 3. Bolts, washers, and nuts for fiber discs. 4. A=rosene v^ clenu filver area 5. Cotter pins 7. Flat washers U. * IIa±ll a ssoiLtntofsr V1. UWS a±'Lu W U o'L'L 9. Packing for gland on pumps 1u. Grease gw (if r eqiusrUU) Whlnen elect rc ImLotors are rlW-uded in the gro-up, incl-ude: - 1 L .~ a) -voLU rieter b) clamp-on ammeter c Y'egger d) electric tape e) fine emery paper f) assorted pliers g) assorted cable lugs h) crimping tool i) soldering iron District and Regional workshops could follow the guidelines to be laid down br the ADC's n00w-well nrMAt. Tists ot eqinpmpen.t req1Tred are to be prepared. RESTRICTED INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION BANGLADESH LAND AND WATER RESOURCES SECTOR STUDY VQT.TJMF. VT RTTRAT. fVlWr.OPMV.T TNI;TTTTITONNg TBf.T4MT(-.hT RRPOP'TNO 19 AG,RICTr.TTR^AT. CREnDT December i, 1972 Asia Projects Department BANGLADESH - SECTOR STUDY VOLUME VI - RURAL DEVELOPMENT INSTITUTIONS TECHNICAL REPORT NO. 19 NOTES ON AGRICULTURAL CREDIT/ TABLE OF CONTE1NTS Page No. SITMAK ANL1 CONCLUS ION'S . . . . . . . . . . . . . . . . . . i I. rNTRODuCTION . . . . . . . . . . . . . . . . . . .....**** II. THiE BANGLADESH PROVINCIAL COOPERATIVE BANK . . . . . . . 2 !II. THE; DIKECTIVRATE1 OF COOPATIV . . . . . . . . . . . . . * 6 1V . iTH iNTEGRATED R-URAL DE-VE;LOPMF;NT PI{OGRAM . . . . . . . . . 8 V. TM; THAN-A CENTRAL COOPERATIVE ASSOCIATION (TCCA) SYSTEM . . 10 VI. SWEDISH SIDA MISSION ON COOPERATIVES . . . . . . . . . . . 13 VI. RECOMMENDATIONS . . . . . . . . . . .. . 1 List of Tables 1. Source of Rural Credit in Bangladesh (1966) 2. Bangladesh Institutional Agricultural Credit - Annual Volume of Lending List of Appendices A Note on Land Tenure 1/ This report is based on the findings of a mission to Bangladesh in 1971 led byv MrA.. P. nra=wr4iv-n SUMMARY AND CONCLUSIONS i. The Report concludes that a thorough review of the agricultural cooperative credit system in Bangladesh is required before the system can be put on a sound administrative and financial basis. At present there are three institutional channels for obtaining agricultural credit - The Agricultural Department which distributes Taccavi (relief) loans; the Agricultural Development Bank which makes commercial loans available to large farmers and agricultural businesses; and the Cooperative Credit system which makes loans through the Cooperative Bank (CB) to the cooperative central banks and finally to Union Multipurpose Cooperative Societies (UMCS). Each agricultural cre!dit institution operates independently and hence fails to provide systematic credit especially to small farmers. Further, the institutions are hampered by inadequate financial support and poor administration. Repayment of Taccavi loans for example, has rarely been enforced - a situation that in itself is poor, but that also fosters a slack attitude on the part of the borrower towards repayment of borrowings from cooperatives. CB's recovering only 75% of its loans is indicative of the administrative weakness of its staff and the staff of its 62 member central banks. The bad debts of the GB far exceed its own finds and the Government 25% guarantees on State Bank loans to FCB (The main source of GB Funds) have had to be performed. ii. The Directorate of Cooperatives provides some disciDline to the cooperative credit system in that it registers cooperative organizations, audits accounts, promotes the formation of new cooperatives, provides field staff to work with cooperatives and supervises and trains cooperative staff. It runs a college at Comilla and 8 local cooDerative trainina institutes. Tt nrovides these services for the most part to the UMCS's and to the intermediary cooperative central banks that are nart of the GB coonerative system. But the Directorate nrovides verv little assistance (only registration and credit) to a new system of cooperatives that is to be extended throughout the country under the Tntegrated Ruiral Development Program (IRDP), and that now exists in 50 Thanas. The system whi ch;- at the primary level- consists of village sOGieties organized for the purpose of Thana Irrigation Program pump rentals or similar cooperative undertakings nperates t.hrough Thana Centran ICooperative A-oup ntj nM (TGCA), which obtain State Bank funds through the CB. While the initial effort of the TCCA is to extend agricultural credit. the TCOA may ultimately take on storage, marketing and other related agricultural cooperative activities. The decision to extend the system (which has involved the estahlishment of a Rural Development Board with wide latitude to supervise the IRDP and related rural development programs) was based on a series of trials beginning with experimental work at the Academy for Rural Development (ARD) to develon rural infrastructure thnt would he effective in making use ofe dlpvelopnment resources. iii. The Report includes recommendations by a SIDA technical mission re.Laed to organization .d ta. (Section 6 Ai r V.lo..'ll datior. to unify cooperative systems, coordinate the work of the Agricultural Developmer.t BarJ-2I. anlL dI the cooperativ - -- st.., to,, ---I t _-ol o CB t to develop comprehensive training programs, are given in Section 7. These recoxi-mendations are tent-ative as they- ae related to- the instit utional framework which prevailed prior to independence. A note on land tenure is r±Vi1 l Al4Je.LLU.A BANGLADESH - SECTOR STUDY VOLUME VI-RURAL DEVELOPMENT INSTITUTIONS TECHNICAL REPORT NO. 19 AGRICULTURAL CREDIT I. INTRODUCTION 1.01 Agricultural credit is provided by three different institutions, the Agricultural Department, the Agricultural Development Bank and the Coopera- tive System. Tne Agriculture Department distributes Taccavi loans through its extension staff. These loans are repayable within a year. They have mostly been given for subsistence purposes to small farmers with no other access to institutional credit. The rate of recovery has been extremely low because of poor administration (collection of repayments is done by the local revenue staff) and the attitude of the borrowers, who have regarded their loans as grants. The volume of Taccavi loans has increased during the past two years, in connection with several programs to increase rice production, but the Government is interested in having the Taccavi loans replaced by better administered institutional credit. 1.02 The Agricultural Development Bank has branches at most subdivisional towns. Its primary objective is to finance medium- and long-term investment in agriculture but about 75% of its total lending volume in Bangladesh is in short-term credit. Its funds are mainly lent to farmers with more than average size farm holdings and it does not have the administrative machinery to reach the small and medium size farmers at the village level. Its rate of interest is 8%. It normally requires land mortgage as security but is extend- ing short-term loans on hypothecation of crops. ADB derives its funds from deposits, Government share capital contributions, loans from the State Bank and has received IDA credit for the financing of farm mechanization programs. 1.03 The Cooperative Credit System has three tiers: the Cooperative Bank at the apex, 62 cooperative central banks at the subdivisional level and about 4,100 multi-purpose cooperatives at the union level. About 8,500 groups of farmers provided with power pumps or tubewells under TIP have been organized as village-based societies and obtained loans from cooperative central banks. In addition to the cooperatives under the old system, the new thana based system of Thana Central Cooperative Associations, and village cooperatives is being developed. 1.04 The lending volume of these credit institutions was as follows: Volume of Lending-Institutional Agricultural Credit Financial Year Taccavi ADB Co-op Total (Mil.Tks) (Mil.Tks) (Mil.Tks) (Mil.Tks) 1965/66 17.8 41.5 9.3 68.6 1967/68 15.2 65.0 75.0 155.2 1968/69 30.0 75.0 90.2 195.2 1969/70 (estimated) 30.0 100.0 120.0 250.0 - 2 - rT flTrr.1 M ^ TI AM-Mrl~T TA %TtP II. CwPnrj UUrnfLA.LVr, DIB.dA 2.01 The CB was registered in 1948 as a scheduled bank under the Banking OrjinIance. It is the apex balk of the cooperative credLit system., comprising 62 cooperative central banks, some urban cooperative banks, 4,100 union based multipurpose cooperative societies, about 8,500 vlliave based pump and tubewell groups and TCCA's. 2.02 The members of the Board are partly nominated by Government and _ @ n 1 ~~~~~_ - 1 _1 - _ _ _ - - - _ - 1- I _ _ALe partly elected by the shareholders. Tne negisTrar, Cooperative Societies, who is the head of the Directorate of Cooperatives is ex-officio chairman of the Board. 2.03 Tne general manager is the chief executive officer of the bank. This post is presently held by an officer from the Directorate of Cooperatives. He is assisted by an officer on secondment from tne State Bank and has under him a staff comprising 45 of whom 4 are of staff rank. These officers are on secondment from the Directorate of cooperatives and have little bank- ing experience. 2.04 The CB has a share capital contributed by Government and by cooperative central banks and other secondary cooperative organizations, each having a prescribed minimum relating to its borrowings. As of June 30, 1970, CBIs total subscribed share capital was Rs 10.5 million of which the contribution by the Government was Rs 4.5 million. The following table shows the growth of the issued share capital: 30.6.67 30.6.60 30.6.70 Mill. Rs Mill. Rs Mill. Rs Cooperative Banks 2.2 3.5 6.o Government 4.5 4.5 4.5 Total 6.7 8.0 10.5 2.05 The CB is allowed to accept deposits and has been able to build up some deposits, but its main source of funds is the State Bank which provides short-term loans to finance the short-term loan requirements of the farmer members of the cooperative societies. These funds are lent to the PCB and distributed by this bank to all the central banks and again distributed by each central bank to its affiliated cooperative societies. The State Bank loans are to be repaid by the CB within 18 months, leaving time for the distribution and collection. The loans are covered by a Government guarantee of 25%. The short-term loans made available to the cooperative credit system by the State Bank have increased very considerably over the last three years, reflecting the high priority given to the agricul- tural sector in Bangladesh and the importance attached to institutional agricultural credit. The following table shows the growth of borrowings from the State Bank and the Government: 30.6.67 30.6.69 30.6.70 Mill. Rs Mill. Rs Mill. Rs .tatp TRank 2Ji.0 57.3 137.6 Government 20. 60.6 79.5 Total 44.4 117.9 217.1 2.06 The loans borrowed from Govermnent reflect the unsatisfactory recovery performanne of thA short-term lending programsT These lons are idenntical with the guarantees, which have become effective, i.e. the amounts overdue from the fanners, at. the spec-ified 4Pi-.O There are several reaons for tih poor loan administration. The CB is too weakly staffed to be able to exercise ___rivir+.P rnn+.r-I earnr it+.c mrmhpr rzn+.r-rnl h-nnuie T+.. r.1 P i n +.hI p n;m n;- c+r_ tion of the cooperative lending programs is limited to the following procedures: a) to collect loan applications from central banks, stating the tn+^+l loan re",,- rem ent of' the farm.er memAbers of the Union Multipurpose Cooperative Societies in the area of op,eratio fecho hsebrs b) to 4. conswo-rn idatiDe thheSe rquiremenr,ets on a nd basis; c) to apply for adequate funds from the State Bank; d) to distribute these loans to the central banks; and e) to collect the repayments and return the funds to the St Late BaIr,. 2.07 The centrai 11b± ank. [ -s are a Vlsow VeJ 4 poorly st-afed a-d nable to supervise the activities of the UIMCS. Most of the loan administration is done by the field staff of the Cooperative Directorate. 2.uu The OD obUtLns he State aeinK loans at U rate of in erIes Of s and relends the loans to the central banks at the rate of 4%. This margin of 1$ is the main source of income oI the bank. Tne folLowing table snows the income and expenditures of the bank in 1966/67, 1968/69, and 1969/70: 1966/67 1968/69 1969/70 Rs i0O Rs '000 Rs :000 Total income 3,198 6,803 9,3049 Expenditure Interest on Borrowings 1,849 14,977 7,1i7 Establishment 576 526 566 Profit 773 1000 1,676 Total 3,198 6,803 9,349 2.09 No dividend has been paid to the shareholders in the last three years, and there havebeen no provisions made for bad debts. The bank takes interests accrued on all outstanding loans into the profit and loss account, including accrued interest on bad and doubtful loans so the above stated figures do not give the true picture of the income and profit earned by the bank. 2.10 The State Bank has investigated the affairs of the Bank. The 4---SW -i. ..tJ- ;sclose +V%n+ - hk b.ad Ae%+s of +Ikp bUKA t* i -re- accrued on bad debts, far exceeded the bank's own funds. The situation is U%Lco11W.ng .ore an -J mUore a] r-r.WAlr a.LJ eLO t:.LAI.f. 2.11..I ±11e len..dr.g prograiI i.. WvU CoOperati.L.V cred:tL.. s (o%.r.L %I.'y L for aus and aman) have rapidly increased during recent years, as will be seen from t.he figures below: WILU -L.L SJ _LV ~ ~ ~ ~ ~ ~ ~ ~ 1.~LL. fl ,7ullvu ~ ~ ~~~ >l 4.%n; 1968/69 70.0 1970/71 102.0 2.12 The recovery of the loans up to 1970/71 has on average been about 7%, Aso that the lUll governmelnl guarlnlte hsb ecUom eIllective, wicn hS very unsatisfactory. The CB is paying interest of 6-1/2% on its Government loans which are financing the overdue laons extended to central banks on which no interest can be collected with the result that the financial position of the GB is rapidly deteriorating. The State Bank nas suggested to uovern- ment that the CB should be substantially strengthened financially and managerially. -1is can be endorsed, uut th GB's role in the administration of the cooperative lending programs is small. A thorough reorganization of the whole cooperative credit system, including not only the PCB, but also the central banks and the primary societies, appears to be urgently necessary in order to put the cooperative credit system on a sound financial basis. 2.13 The role of the CB in the Integrated Rural Development Program (see section 4) is at present very limited. The CB is included in the program, because of its relations with the State Bank. The TCCA's send their demands for short-term loans to the State Bank through the CB. The CB distributes the funds received from the State Bank to the TCGA's which make repayments at the due dates. These transactions involve a minimum amount of CB administration as long as the TCGA's are administering their lending programs correctly. The focus on proper organization and arrangement in the IRDP is primarily on the TCCA's. - 5 - THE COOPERATIVE BANK Conden"sed Balan-ee She-at (Am nn In-A- 1 O/7 10A0 1a07n A aaa+a. ('t1, 4w.. uY.A 10 10 'O Deposits with bank 15,36o 27j,474 31,646 Loans and advances 52,9433 127,138 226,348 nO,'-Uuer assetsg U,65 12,303 18,164vjA. A '~JULA~L ~aaV V.ug r To-taLl 8207.7 i7.9 8,4 Liab±1±ttues: Sc"L-Aa-re V4l0ap«L ( 6,778 8, 10,520 Reserve Funds 6,343 8,222 9,,433 loars frvm iGovernrent 20,V445 60,657 79,489 Loans from State Bank 24,013 57,308 137,615 I -- el ~ - 'o. - l I- Ov~erurafts~5 L.4(YO 4,798( 7 i4,637 Deposits 17,380 20,209 21,887 Other Liabilities 2,340 -6,386 8,862 To tal oe2wy' 173,472 282,443 III. THE DIRECTaRATE OF COOPERATIVES 3.01 The Directorate of Cooperatives is a regular Government agency. It is placed under the Agriculture Department and is headed by the Registrar of Cooperative Societies. The primary function of the Directorate is to administer the provisions in the Bengal Cooperative Act of 1940, as amended by the Government of East Pakistan. All cooperative organizations and societies have to be registered by the Registrar and are subject to having their accounts audited by auditors appointed by the Regis- trar. In addition to its statutory functions the Directorate has undertaken functions like promotion of cooperatives, supervision of cooperatives, train- ing of cooperative staff and research. 3.02 The Directorate has a central organization divided into three wings: credit, headed by a Joint Registrar and assisted by a banking adviser seconded by the State Bank; administration, also headed by a Joint Registrar; and audit, headed by a Ch_ef Auditor. There are special sections under the administration wing for development, extension and liquidation. In addition there is a field staff, comprising a Deputy Registrar in each of the four divisions, of Bangladesh (Dacca, Khulna, Chittagong and Rajhahi), an Assistant Registrar in each district, a Sub Divisional CooDerative Officer in each subdivision and a Thana Coopera- tive Officer (TCO) in each Thana. In areas with large numbers of pump group societies newly recruited Union Cooperative Officers have been posted. The audit wing has staff posted in districts and there are special staff for fish- ery cooperatives, industrial cooperatives and other urban cooperatives. The Directorate runs a college at Comilla (where training is mainly given to cooperative officers) local training institutes, (where training is given to officers, staff of cooperative organizations and office bearers of coop- eratives). 3.03 The field staff is closely associated with the administration of agricultural credit through the cooperative credit organizations. Coopera- tive officers are seconded to the CB and all the 62 cooperative central banks have officers from the Directorate as executive officers. Loan appli- cations from the Union Multi-purpose Cooperative Societies, and the pump group societies, are processed by TCO's who also write the accounts of the societies and audit them. The loan applications are consolidated in the central banks and sent through the Assistant Registrar (AR) to the CB. For collection the societies and the central banks similarly rely on assist- ance from the field staff. The AR's have in addition to their powers under the Cooperative ACt certificate powers so they can authorize collection of arrears. TCCA's 3.0L The relationship of the Directorate to TCCA's is at present limited to registration and audit. 7 7 = ORGUANIZATION14AL CHART OF THE DRUECTOR.ATE OF COOPERATUERS Joint Registrar Joint Registrar Chief Auditor (Cre_it) (AA,n) ±JO.rgL.Lfl6 Advis .J..Odr. 4n 0. J.La.t0- District Audi-.ts Assistant Registrars Extension Sub-Div. Auditors Inspectors Trai-4- Research DIVISIONS Deputy Registrars (4) DISTRICTS Assistant Registrars (18) SUB-DIVISIONS Sub-Divisional Coop Officers (62) TiNAS Tnana Cooperative Officers (4WI) UNIONS (Union Cooperative Officers) IV. THE INTEGRATED RURAL DEVELOPMENT PROGRAM 4.01 The Pakistan Academy for Rural Development (PARD), now the B ngladesh Academy for Rural TDeve1onmPnt. (HARD) ; started functioning in May 1959. In addition to its principal function of training gove.mlient Io.LLf cID, tL I LAuLnU.L LIoo V AkJr;=.L 'LUIJ I o PYWJ.k fo A AJl V .=- - - patterns for rural development. It considered that the diffusion of ideas aLLdu auduoption ofL 'Zinnovatuions in ± arU.L 'd.LVtO IlitA mu bJe pJUomoLteUd UL1±1-JU,1L Uthe peoples' own institutions and that the lack of organization in rural areas has often proved to b'e a major bottleneck to the achievement of official production targets. The objective therefore of the Comilla approach was to creaTe a rural institutional infrastructure for the effective utilization of resources available for development. 4.02 - In February, 1960 Kotwali Thana in the Comilla District was taken over by the Academy for experimental planning and in January, 1962 the Kotwali Thana Central Cooperative Association was established and register- ed with the Registrar of Cooperatives, Department of Agriculture. it was decided to test the approach used in Kotwali Thana in three new areas; these tests were started in July, 1963 in Mymensingh, Rangpur and Rajshani Districts. The tests were considered successful and a program to estab- lish TCCA;s in 7 Thanas was started in July, 1965; following evaluation of the progress in these 7 Thanas, the program was extended to 13 additional Thanas in October, 196o. The zu TuCA's were originally administered Dy the Department of Agriculture but transferred to ADC in October, 1969. 4.03 In October, 1970 proposals were tabled to extend the system of TCCA's throughout the country's 413 Thanas and prepareation of a program to be known as the Integrated Rural Development Program (IRDP) was begun. On February 2, 1971 the Bangladesh Rural Development Board (RDB) was established to administer the program. 4.04 The Board was given the following functions and authority within the framework of the policy directives of the Government: (a) to lay down the policy and exercise general supervision with respect to implementation of the Integrated Rural Development Program, and other related projects and programs; (b) to coordinate the activities of various departments/ agencies connected with the program; (c) to approve the operational pro- gram and the annual budget and arrange for the audit of accounts; and Cd) to take responsibility for other measures relating to rural development. 4.05 The Board was empowered to appoint special committees, an Executive Director and staff, decide terms and conditions of service. imDart training to all officers employed, conduct research into rural development problems and evaluate performance of the program. The Board was to funntion under the administrative control of the Planning Department and have the following membership: The Governor of Bangladesh (Chairman): Ch2irmnn of the P1nn- ning and Development Board, ADC, WAPDA; Secretaries of the Finance Department, Agriculture Department. LG Department: R-estrar- Gorive Societies; Director of ARD, Comilla; and Executive Director IRDP (member- secretary). -9- 4.06 A District Project Officer was to be posted in each district. He was to be a member of the District Develomnent Coordination Committee headed by the Deputy Commissioner to maintain liaison with all agencies to secure supDort and cooperation for the program. He was to supervise the work of the Thana Project Officers in the TCCA's in his District. 4.07 Each Thana was to have posted in it a Thana Project Officer (TPO) in charge of the TCCA- which wwolld elect its own Msnagina Gomm.itte The TPO was to secure the cooperation of all Thana level organizations. In additionj 2 ~ pniift Pronect Officer and sn Accoutntant were to be posted in each TCCA. Field inspectors were to be appointed and paid by the TCCA. 4.08 Personnel were to be carefully selected and thoroughly trained; nmho r-q be t.r:ainnS tor beo cniffi t loro +.i-1u 1 nv' iln- u ~ r furr~. .q1lrF during and after training. Thana personnel were to be on probation for at least on.e year in the field. Tranning was to be provided pinciplly at the Academy for Rural Development (ARD) at Comilla and at the Coonerativer Gollege -10- V. THE THANA CENTRAL COOPERATIVE ASSOCIATION (TCCA) SYSTEM 5.o1 The TCCA is registered with the Re2istrar. Coonerative Societies. of the Department of Agriculture, as a secondary cooperative organization. It does not deal directlv with the members but onerates through nrimarv societies. These societies, of 30-50 farmers, are voluntarily organized on a village basis. as oroups for the joint use of low-lift pump or tubewell or some similar primary cooperative purpose. The societies elect their own managing committee; a manager; a model fnrmer and, where annlicable a Dumn and/or tractor driver; the TCCA appoints an accountant to the society. 5.02 The activities of the TCCA include the promotion of new primary societies, accumulation of share capital, collec'ti on of me-mher- I vings deposits, extension of loans and training of managers and model farmers. The training of' managers and model fan-mners hs bhen dne at Thana Training and Development Centers (TTDC)in conjunction with officers of various gov- e.mment de-art-rnents ii-nder the Than.a !=r--gain, Pl^ogrrr-. (rTIP) (see TPechvnJe.qc Report No. 18). All members 6f primary societies are obliged to buy shares of Tk- 10 each in the TCCA and are required to save regularly in accordannce with a mutually approved plan drawn up in each society; the savings are not kept by the society but are deposited wth the TCCA. Ths TCCA kp al funds in an account with a local commercial bank. 5.03 The main activity of the TCCA is to extend agricultural credit thr-ugh th'e p'. maIry societies aftf iliated to lt. Th e. procedU res for such. lending are as follows: (a) Primary societies are obliged to hold a weekly gen- eral r,eeting1 UV Udiscuss dLI agl-eeo joi nt.II oper~IaUin.LI Every six months, at these meetings, societies evalu- aL,e UL,Ii U.L-tLLLU l iie;ii V.A. :R:U.I1 IILieIlJe± l d LIDU J.iILLLV.LV UUad± loan limits; production plans for the society are pre- pared as a basis fIor loan applications to the iuUA. The loan limits approved by the society for each member are su'umitted to TCUCA fi -LQ Inspectors wh,o prepare loan ceiling proposals for each society under their super- -vision. The proposals are re-viewed and approved first by a loan committee consisting of the Project Officer, Deputy Project Officer and two elected members of the Managing Committee of the TCCA. After approval the society may request as many loans as it wishes during the six month period up to the total amount of the loan coiling. (b) A member requesting a loan must do so at a weekly meeting and justify his request. He may be joined - 11 - by others making requests and the manager fills out a loan reauest form for all anolicants together, con- taining the names of each member asking for a loan, the share and savings nosition of each. their six- month loan ceiling and the amount of the loan reques1-ted. The 1 nn request. f'cvrm mist. 'h nrAsente.d to the TCCA together with: (i) a resolution drawn up mnni signed by the memTbers asking for n loa n; (ii) a promisory bond signed by the members of the managing C.rm1mHne.PA of +.he so-iety; pledging that. the scrJPietv will repay on the due date; (iii) a loan repayment scheduile under which the society prnmises to repay the installments of the loan; (iv) a power of attor- neyv agranti+nc +.he TGGr.4auhrt tor- prosecutenm+, any individual defaulter; (v) two copies of a land mort- gage for every mnember requesting a meainm n ' long term loan. 5.04 These documents are examined by the inspector and submitted to the Depfyuty P roe Officer %TJt a ,-rert.+ hythe += I nantr^+n Aft+erz app"niral of the loan by the Project Officer a loan advance form is issued to the manager of the society. Te inspector releases the loan funds in accordance with his view of the proper use of the funds and not as one lump sum. Money is A-,?ra f,,-v -k ,wvm. ni h.,mLr h.- 41-l-o -c,- -+ /vy '-n +V,-n,.n - i-wa - -nnor drawn fror. the --r-.ercial barb by the inspector a4r.d w t magef/, who paJ ys out the loan to the member in the presence of the inspector. Members sign a Lon di_Dusemnt Alert-ifica _+; TA;C1 4+S..;h; 1,8p4- 1A,F +h, NtrVr'A :- 4- h P4 n- 4 | ,- ..LjJX' z VL 4.L,Jt L.'L4 .J L'~ V t i 'J . 4 UO WLL4A J . U WYJ U.LIU .L' t 411 1W 4. 1 IV K U JJ on each society. 5.o5 When a member makes a repayment the manager makes out a loan repay- r,e-,.len receipt for c0unter-signatuure at le '1'CCA. IfII, iIfIdlagUIi L± i UoliUged to show this rece:ipt duly signed to the members at the next meeting of the society. i cases of defa-ult the inspector will first try to collect s-u.-ns overdue ancL failing will recommend that a case be filed against the defaulter. An officer from, the Cuoperative Directorate of the Registrar w'l be deputed to assist on the case if proceeded with but most cases are settled out of court. 5.06 The TCCA makes short term loans of up to .18 months, but mainly of 6-8 .,monthIA, fr.L fertUlize.r, seUes, adlL Imaei. LLLg arll VUII c.Erop prodL-ctUII purposes; it makes medium term loans of up to 3 years mainly for livestock, i.m-plements and the consolidaion of debts to m,toneylenders; it mrYakes long term loans of over 3 years mainly for land improvement, orchards, pumps and other farllrm machinery- and release of mortgages mainly held by moneylenu.ers. 5.07 To qualify for a loan,a member must have paid up all previous loans, saved regularly for at least 6 months, made a contribution to the share capi- tal equivalent to 10% of the loan or have shares to that amount. No colIat- eral is required for short term loans but land is usually taken in mortgage for medium and long term loans. As a general rule short term loans for an irrigated rice crop may not exceed Tk200 per ac and for a non-irrigated rice crop may not exceed Tksi50 per ac. Tne loan ceiling for a society is not expected to reach Tks330,000 untiLl about the fifth year. - 12 - 5.08 Loan charges levied by TCCA's on the individual members of primary societies are made up as follows: Percent Interest charged by the State Bank to the Coop Bank 3 Service charge by the Coop Bank 1 Interest charged by the CooP Bank to the TMA 14 Serv-ie charge by TGCA for TEQ oneration (a) 2 Serv ice charge by TnnA for field minerviqion and training (b) 5 Service charge by TCCA on behalf of Primary Society (c) 1 .ti-nteP.rest chn-aprge to inrdivrirdiin member 12 Interest collected on behalf of the Primary gCoc4a+.7T (rl' 3 Interest charged to individual rmember 5.O9 Tne TCCAts have no internal audit system. Tneir accounts are audited by a chartered accountant appointed by the Registrar, Cooperative Societies, once a year. Tne auditors report is sent to tne Registrar and nis field staff is responsible for supervision. 5.10 The TCCA's provide travel and subsistence allowances to managers and model farmers for their weekly visits to mTana Training and Development Cen- ters (TTDC) for training. The allowance to managers is Iks' 8 per training ses- sion attended and to model farmers is Trks2. Training is provided at the TTDG by Thana level officials of various government agencies under the TIP. -13- IV. SWEDISH SIDA MISSION ON COOPERATIVES 6.01 On July 22, 1970, the Government of Bangladesh requested a S4edish mission to make a preliminary review of the cooperative system in- Bangla- desh and the training of cooperative officers. The mission was to pay Darticular attention to the needs arising from the decision to launch the Integrated Rural Development Program. The main findings of the SIDA pre- parat ory mission recommended a more detailed and longer term investigation of their main findings by a team that they hoped SIDA might protlde. Their main findings were as follows: Organization (a) In connection with the establishment of an organization for the IRDP, a review of existing authorities dealing with coop- iratives is necessary. This would include the IRDP organi- zation the Directorate of Cooperatives, the operative Bank, the Central Cooperative Banks and the Multi- purpose Cooperatives run by the Directorate. Such a review should aim at a clear definition of the role of each organi- zation and, following from that, proposals should be worked out for how they should be organized, changed or, possibly, dismantled. The review is particularly necessary in the case of the Directorate of Cooperatives and the Cooperative Bank. Possible alternatives for the administration of agricultural credits need to be considered. (b) In connection with the functional analysis of the cooperative bodies, distinctions should be established between the ro:Les and responsibilities of Government employees and the employees or elected representatives of cooperative organizations. (c) A study of the present debt situation of the Cooperative Bank and the Central Cooperative Banks should be undertaken and a policy proposal for the handling of these debts should be worked out. (d) In connection with credit administration, a review of policies, practices and procedures. including accounting. audit, statistics, etc. is needed. Training (a) Training requirements of the staff of IRDP, mainly at the Thana level, of the staff of the Directorate of Goonpratives and of employees of cooperative organizations need to be analvzed in detail. Particular attention should hb nnpai tn the training at Thana Training and Development Centers (TDDC). Programs should be directed in part townrds training members of primary societies to become leaders and administrators of nnooperative societies. -14- (b) If the Cooperative Bank shall be responsible for agricultural credits, the questions of the training of its staff will have to be studied. (c) The division of labor between the Bangladesh Academy for Rural Development and the Cooperative College should be spelled out. A review of the function of the Cooperative College will probably show that the facilities of the College will need to be expanded. If that is so, a plan for the expansion of the College should be worked out. (d) There are eight zonal institutes under the College, used for training of cooperative officers and leaders of coop- erative societies. A plan for their improvement should be developed. (e) The training programs and syllabus of the existine cooperative training institutions should be analyzed, as well as the institution's needs for facilities. eouipment; books and budgetary allocations. During the-review of the training programns, special al.ttntion shouldbe pnniri to subjects like bookkeeping, accounting, auditing, business administration and marketing. (f) Advanced studips of snhijets, like mnagrment, business administration and marketing (desirable for an increasing number of employees of the cooperative organniztio-n) need not necessarily be studied at special institutes for co- operative training. Instead, such training shoul1d take place at institutions like the Institute of Business Adm.inistration at the Dacca University. The University should be requested to establish the suitability of C4existingourses for th requiare---..ent a f the c eat- -4- organizations and, if needed, to take steps for the development of suitcable cour-ses. A a-a an.4 a, 4- a - 4' a,, 4- ,1&1 a -a4, 4-s- car.1, %~ 5) ..LL.4. V4. UJllV .J V.. V ULCLU LIL'JOU J41JJ- V'LVV.L11 VIJII cooperative movement will be farmers, it is essential that 4th,e staff. of Ile cooperatives have 1_-,owledge ofaXl'tue UL Id..L.L 1J UJI U Jj± d -L,±~ LiV ru i-4Lt'LJr %J.J Ur.L±LUU-LUU.L U. All cooperative educational institutions should, therefore, hIave o,lentation courses -"I agr1.LtLLLULL.tu relU ar, LLIILd- 11L.L uslaruvy* These courses may possibly be prepared by the Mymensingh A91-1 VL UU.± IjL±L U1I.A V E±-01L. rTTTT * nnTmrThT AT OTTnnlM-rna,rn V ii. VL ".UI'j&Lj OIwL.ollfiuo 7.01 uovernment support may need to be concentrated on tne basic needs Of the cooperative movement, especially in the initial stage of operation-- training, extension services, advisory and supervisory services, capital contribution, subsidy for basic facilities, guarantee of loans, etc. 7.02 Taccavi loans may be best distinguished from grants or subsidieE especially in the case of loans for relief. Because of the ambiguous nature of such loans, funds have been used [or non-prouclti ve purposes an.d repayinent has been low. This slack attitude towards loans has affected the repayment of borrowings from cooperatives. Caution may be needed that lUan16 are wiitten off only in cases of irrecoverable overdues, i.e., after all possible efforts have been made for recovery. Taccavi loans may possibly be made only to far- mers who cannot borrow from the cooperatives and other credit institutions (small farmers below the suDsistence level who are too risky for the coopera- tive credit in the immediate future and ways and means explored of eliminating Taccavi loans altogether. Instead, outright relief grants for disasters may be preferable. 7.03 The relationship between the Cooperative Directorate in charge of registration and audit of all cooperatives and the Rural Development Board (established for the IRDP) in charge of the new cooperative system, the responsibilities of each at the provincial, district and thana level should be defined clearly. This may be extremely important in carrying out a uniform policy because the existing system (including the Cooperative Bank is likely to remain under the control of the Cooperative Directorate. 7.04 To ensure proper supervision, Government may be most effective in inperv-jqinp only atdministrative asnects The financial side may be better handled by the central financing agency (for the time being, the State Bank m2y be the onnlv agno-r narahleA hiut the anex bank might be the agencv responsible in future) because professional staffs of high caliber may not be available in the Go'ern.ment ageneies. 7.05 Government may need to prepare a program to wind up the exi sting cooperative system and unify the two systems. Sound and healthy cooperatives could be transferred to the new system but insolvent cooperatives maY have to be liquidated. 7.06 Before liquidating insolvent cooperatives every individual overdue loan could first be investigated thoroughlv At the nrimarv level. Then whatever measures necessary for recovery including compulsory proceedings may need to be taken. After such strict measures are followed the ir- recoverable portion may become clear. Special action to write it off would be necessary at the final stage. A sDecial government tem or agency may be needed to complete this complex task. 7.07 Although commercial banks have played an almost negligible part in nrovidingp awrimulturql nredit to rnteA thev mav need to be exploited in providing loans in the rural area. In particular, distributors of inputs and small nrocessors of credit for marketing and storage cojld obtinn loans from commercial banks in addition to the Agricultural Development Bank loans. The large credit reoirTnrement for agcrnilt-lnral developmeant may not all be met without the participation of commercial banks. 7.08 Close coordination may be required between the Agricultural Develop- ment Bank anAd the copeativer sstem.. Ban.ks c-1A utilie the ye network in making medium-and long- term loans to cooperative members. - 16 - 7.08 Whether the Cooperative Bank will continue as the apex bank of the new system is not clear. Under the IRDP, the Bank used to channel the State Bank funds to TCCAs and it is not scheduled to function as their apex bank (to be in a capacity to provide professional services to its affiliated member in regard to financing and banking). 7.09 Since credit is the major operation of the cooperative movement, the TCCAs may have to first start as "credit cooperatives" instead of "multi-purpose cooperatives". When the credit operation becomes well stabilized as a viable business unit, its experiences and profits could be employed to systematically expand operations into marketing and allied fields. 7.10 To avoid deterioration of the financial position of the TCCAs initial operation may need to be limited to loans (mainly short-term loans) for agricultural production. Thus non-agricultural lending may have to be prohibited and non-credit operations may be considered only after receiving the approval of the Rural Development Board. The business operations of the TCCAs may need to follow the policies worked out by the Rural Development Board. In case of a uniform lending policy, factors to be included may have to be interest rate, security requirements, evaluation of security, etc. Based on these policies, instruction manuals for the staff (project officers, accountants, inspectors, etc.) could be prepared to unify the procedures used by the TCCAs. The present statistical and progress reports are not sufficiently informative and are deficient on lending progress, recoveries and financial results. Lacking an internal audit system, accounts mav have to be audited by a chartered accountant once a year. 7.11 The present training arrangements for the membership and staff of the TCCAs are still inadequate to establish viable cooperatives based on responsible local leadership and firm membership loyalty. A major effort may be required to carry out a comprehensive training program. Since training of managers, model farmers and village accountants depends on the abilities of their trainers, who in turn need effective trainers, it may have to cover all levels, the TCCAs as well as the staff of the government and other supporting agencies. TABLE 1 BANGLADESH - SECTOR STUDY SOURCE OF RURAL CREDIT IN BANGLADESH (1966) Non-Institutional Friends & Relatives 52.05% Landlords, Traders, Moneylenders 34.09% 86.1)4% Institutional Co-operatives 7.735, Agricultural Development Bank 5.36% Taccavi Loans 0.77%X 13.86% TOTAL 100.00% BANGLADESH - SBCTOR STUDY INSTITUTIONAL AGRICULTURAL CREDIT ANNUAL VOLUNE OF LENDING (Millions of Rupees) Agency/'npe 1960-6:L L961-62 1962-63 1963-64 1964-65 1965-66 19,66-67 1967'-68 1l968-69 19651-70 (Estimate~) Taccavi 13.48 21.45 29.00 38.45 30.22 17.79 19.04 15.28 25.40 30,.00 A.D.B.P. 38.19 40.'54 37.67 38.34 36.48 41.55 47.11 65.,00 75.759 69.,50 Co-operatives 43.o8 45.70 37.82 35.35 25.57 9.38 23.18 70.,10 7'9.05 123.80 Source: Planning Department, using data of: a) Department of Agriculture, Gcverrment of East; Pakistan b) Directorate of Co-operatives, Dacca c) The Agricultural DevelopmeLent Bank of Paki.stan, Dacca APPENDIX Pare 1 BANGLADESH - SECTOR STUDY A NOTE ON LAND TE/NURF 1.* The histor- of Bangladesh can be seen as tne history of a system of rights to land and of the right to raise revenue from the holders of those rights to land. The present social conditions of Bangladesn are partly the result of the land tenure system. The history of the land systelm m a y be divided into four perio-; The Hndu, the M-uslim, thLe British and the Post-Independence. The Hindu period established the under- lyirng principle of the Bangladesn land system, the undisputed right of the farmer to the land he tilled. 2. Throughout the Muslim period (1278-1765) the farmer's right to the land he tilled was U a.intained, while th.e rulers exercised a right to revenue, taxes, cesses and the power to make grants of waste land. Larnu revenuae ad-inistration was governed by the fact tliat tlhe bupply of land in those days was much larger than the demand for it. Therefore, the aim of administration was to keep peasants on the land. A peasant was not displaced so long as he did his duty. Even when he failed to do it, he could not be displaced without a substitute being found; wnere iand was waiting for cultivation, an inefficient cultivator would be better than none. Thus occupancy rights emerged as a matter of course and became customary. 3. In the latter part of the Muslim period a spectacular growth in the system of farming revenue occurred as local governors became more and more independent of the court at Delhi. The farmers in return for a stipu- lated payment, were allowed to appropriate revenue to their own use and to do as they liked with the tenants. 4. The period of British control of Bangladesh (1765-1947) was dcminated by Cornwallis' Permanent Settlement Act of 1793. Prior to the Act, the Raj auctioned revenue rights annually. The Act sought to fix the revenue to be derived from the land and so to avoid the injurious effects of the prev:Lous auction and earlier revenue estimation and collection practices. The Act established the Zamindars as the hereditary proprietors of land. A sub.- sequent Act of 1859 divided the tenants into three broad classes: (a) those holding land at a fixed rent since the Permanent Settlement Act -- tenure holders; (b) those holding land for twelve years whether at a fixed rent or not -- raiyats; (c) those holding land for less than twelve years -- uider- raiyats.- Successive Acts in 1885, 1928 and 1938 were promulgated to reduce the inequi-ties of the system, to strengthen the position of the raiyats and under-ralyats and to promote land consolidation by removing the right oi the landlord to charge a customary transfer fee of 20% of land value. 1/ This appendix was prepared by Norman Reynolds. APPENDIX PDage 2 5. ~Thal use of' fix-ed land r-eve'nue b-y t-1e Briti sh J'n B.-des a effects that made a mockery of the niceties of the successive Acts. It enabuleu a large n-uL-4 ..er ofL nterminedCiaaies between thle ZWLdL1iIUd.± cdUl tlhe cultivator to arise, which in some districts reach fifty or more. The intermediaries -were supported by the c-ultivator but had neither- the responsibility, the power nor any incentive to improve the use to which the land was put. Government, faced with an inelastic land revenue fixed over long periods, had little inducement to invest in agricultural devel- opment since any benefit wou.ld flo-w solely to prlvaut paries. 6. A Commisison on land tenure reco Luended the abolition of the Zamindar by eliminating all superior and middle rights to land, thus bringing the cultivators into a direct relationship with Government. Tne State Acquisition Act of 1950 enacted the Commission's recommendations. A further Acquisition Act oI 1956 acquired all such interests in a summary manner. The legal situation vis-a-vis land tenure would appear today to be satisfactory. However, historical and more recently created forces that bear on land tenure complicate the picture and suggest that there may be reversion to wnat may oe termea customary law. Qudir notes that up until a hundred years ago the village absorbed newcomers, but that no new families had joined the village since. Moreover little land had been acquired outside the village by the villagers since 1948, whereas before, land acquisition outside the village had enabled the families to maintain farm size from one generation to another. Competition for land is a relatively recent feature of Bangladesh life and is today heightened by what are surely severe limits to mobility, both geographical and social. The pressure on resources has, again within only the last decade or so, caused the breakup of many joint families into nuclear units. Such a development runs counter to the economic logic of the situation for it frequently involves a less optimum use of land, cattle and equipment and reduces the chances for consolidation. The facts presented by Qudir and by interviews with farmers and officials suggest that the joint family to survive must enjoy a minimum subsistence. Once deficits in food and the means to purchase other necessities arise, which today includes education, medical treatment and the like, the more able or better endowed will leave the fold, often at the insistence of their wives who may well hold their family's wel- fare above that of the group. 7. Litigation over field boundaries between neighbours was formerly the most common form of litigation and a case in court was considered to enhance a family's status. The costs of litigation have risen appreciably so that litigation cases are not so common today as they were a decade ago. Moreover, the nature of the majority of cases has altered. Now litigation over inheritance predominates: a fact that supports the rate at which joint families are breaking up. A new form of litigation has arisen which under- lies the pressure on resources and which may have widespread economic and even political ramifications. In some areas litigation is being pressed by claimants to land who base their claim against the present title holder on the relative historical strength of the families' positions, i.e. claims for the control of land rather than for the adjustment of boundaries or of APPENDIX .LLLLJW.L . dUC¶I,U. T.hese clW..LmS C a.Lis, C2pF..L &1tO.Ly, J..LtAIL thL1e PermanenLt Setile,ment, Acts of 1793 and, more particularly, 1859, which created three classes of 4tenants. It- is not& clea -&,- rights CpI-4r A- 44 -zh Stt con Act -an Loui.ALi 1 Li .Ld LAUU %,L LL Cd.I AJLJWV LI6. 4 1UQ jJ.L .U.L L j I LAJ UiJ W,) Li U X4'~4..L%,k . I .J.LV LA 41'. U .. be enforced in court. Forged documents are often used. The documents are 40'-rged r,.more bekcaVuseVVA old UregiLer U ave bee nLV 'AUlifiedI by thev State~ Acq sLition Acts than to present false testimony. The issue, which is claimed to be ±LCrly widespread, is o'L 'LI4-1.pLortiance bUecauase it reLpresents'L. tihLe re-e-ergence of customary law. 8. A special case -within the land tenure system of Bangladesh is that of L1hW fLsbherm.en. i''l -lau-ge waveo-r bodiies -wer-e untQil thei ouaue Acquisi1tion1 ituuo controlled by the Zamindar. Fishing rights to these water bodies were sold annually to fishermen, most of whom, like the Zamindars, were Hindu. Even bodies of water which dried up during the winter and the land which was owned and farmed in the boro season by cultivators was, when wet, controlled by the Zamindars. The growing pressure on land produced a clash of interest between the fishermen and those cultivators who owned land which was annually flooded and while flooded controlled by the Zamindars. Most water bodies can be either drained through inexpensive local works, or maintained as fishing areas with the help of small dykes. Under the Zamindars the fishermen's rights, though only as annual lease right, were protected. After Partition and the State Acquisition Acts the Zamindar disappeared and the Government through the Revenue Department assumed control of the major water bodies. The culti- vators were able, through their ownership rights and by virtue of their higher social status as cultivators, to force the drainage of many of the water bodies. There was also a rush in the period after the second Act (1956), which acquired all Zamindar rights in a summary manner, to claim land that was permanently under water.