Document of HEThe World Bank COP

FOR OFFICIAL USE ONLY

Report No. 32 80-BD

BANGLADESH

HAND TUBEWELLS PROJECT

STAFF APPRAISAL REPORT

April 17, 1981

South Asia Projects DepartmentAgriculture Division B

This document has a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorization.

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

CURRENCY EQUIVALENT

US$1 TK 16.0TK 1 = US$0.0625

TK 1 million US$62,500

WEIGHTS AND MEASURES

1 acre (ac) 0.405 hectares1 cubic foot per second (cusec) 0.0283 cubic meters per second1 foot (ft) 30.5 cerntimeters1 imperial gallon 4.545 liters1 maund (mid) 37.3 kilogramsI metric ton (ton) 26.8 maunds1 seer 0.933 kilograms

FISCAL YEAR (FY)

July 1 - June 30

FOR OFFICIAL USE ONLY

PRINCIPAL ABBREVIATIONS AND ACRONYMS USED

BADC - Bangladesh Agricultural Development CorporationB. Aman - Broadcast Aman paddyBARD - Bangladesh Academy of Rural DevelopmentBIDS - Bangladesh Institute for Development StudiesBKB - Bangladesh Krishi Bank

BUET - Bangladesh University of Engineering and TechnologyBWDB - Bangladesh Water Development BoardCB - Commercial Bank(s)

DOAEM - Directorate of Agriculture (Extension and Management)DPHE - Department of Public Health and EngineeringDTW - Deep tubewell

GDP - Gross Domestic Product

GI - Galvanized iron

GOB - Government of BangladeshGPM - gallons per minute

HTW - Hand tubewellHYV - High-yielding variety

IBA - Institute for Business Administration, University of DaccaICB - International Competitive BiddingIRDP - Integrated Rural Development ProgramKSS - Village Cooperative Society (Krishi Samabaya Samity)LCB - Local Competitive BiddingLLP - Low Lift Pump

MA - Ministry of Agriculture

m-d - Mandaymd/ac - Maund per acre

MIS - Management Information SystemMLGRD&C - Ministry of Land Administration, Local Government, Rural

Development, and CooperativesM&E - Monitoring and EvaluationMOSTI - Manually Operated Shallow Tubewell for IrrigationMT - Medium TermMTFPP - Medium Term Foodgrain Production PlanPVC - Polyvinyl Chloride

RDTI - Rural Development Training InstituteSFYP - Second Five-Year Plan 1980-1985SSIP - Small Scale Irrigation ProjectST - Short Term

STW - Shallow tubewell

T. Aman - Transplanted Aman paddyTCB - Trading Corporation of BangladeshTCCA - Thana Central Cooperative AssociationTIP - Thana Irrigation ProgramTOR - Terms of Reference

TTDC - Thana Training and Development CenterT&D - Taxes and Duties

T&V - Training and Visit extension systemUNDP - United Nations Development ProgramUNICEF - United Nations Children's FundUSAID - United States Agency for International DevelopmentW - With Project CaseW - Without Project Case

This document has a restricted distribution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

BANGLADESH

HAN,D TUBEWELLS PROJECT

TABLE OF CONTENTS

Page No.

I. INTRODUCTION ............................................. 1

II. BACKGROUND ....................... 1The Agricultural Sector ...... .................. 1.......... IDA Operations in the Agricultural Sector ............... . 2Crop Production, Constraints and Potential ............... 3Cropping Patterns . .... ............................... 4

III. IRRIGATION .................................... 5Strategic Importance of Irrigation ..... ............. 5Groundwater Resources ................................... 5The Exploitation of Groundwater throughMinor Irrigation ................................... 7

The Hand Tubewell Program ................................ 7Area Suitable for Hand Tubewells ..... ............ 9Marketing of Hand Tubewells ............. .. ............... 10Credit to UNICEF MOSTI Purchasers .......... .. ............ 10Demand for Hand Tubewells ................................ 11Domestic Mianufacture of Hand Tubewells ......... .......... 12Supply of Pipes and Strainers ............................ 14Important Aspects of Future Hand Tubewell Projects ....... 14

IV. THE PROJECT .............................................. 15Project Background ....................................... 15Project Objectives and Target Group ...................... 15Project Area ............................................. 16Project Description ...................................... 16Detailed Features ........................................ 16Distribution of Pumpsets and Tool Kits ................ ... 20Hand Tubewell Purchase Price ..... ........................ 21

V. COST ESTIMATES AND FINANCING ..... ........................ 22Cost Estimates ........................................... 22Financing ................................................ 22Procurement .............................................. 24Disbursements and Audits ...... ........................... 25

VI. PROJECT IMPLEMENTATION AND EXECUTING AGENCIES ............ 26Project Organization .................... 26Procurement and Distribution of Raw Materials ............ 27Fabrication of Pumpheads and Strainers ......... .......... 27

- ii -

Page No.

Quality Control of Pumphead and Strainer Fabrication ..... 28Credit Program ........ ................... ............ 28Training ........................................ 29Research and Testing .... ...................... ........... 29Monitoring and Review .......... . . .. . ...... . ..... ...... 30Project Accounts ...... ....................................... 31

VII. PRODUCTION, MARKETING AND COST RECOVERY ... ............... 31Cropping Patterns .... .................................. .... 31Yields and Production .... .o... ........ . . . . . . . . . . . . . . . . . . . 32Crop Input Requirements ............................0.... 33Irrigation Requirements and Pumping ...................... 33Energy Requirements for Pumping .......................... 34Marketing .- o .............................. ...o.... 00 000006 ....0-.0 34Farm Incomes and Cash Flow ....... .*. ...... o.-o. . 35Prices ....... ................................... 36Cost Recovery ............ ................................... 36

VIII. BENEFITS, JUSTIFICATION AND RISKS ........................ 37n-roject Benefits .................................. 00..... 37Project Beneficiaries ... ..... .. . . . . . . . . . ....... ..... ..... 38Environmental Effects . ... .-. . . . . ........ . . . . . . . . . . . . . . . . . . 38Economic Analysis and Sensitivity Tests .................. 38P-roject Risks ..... o-.... o... 40

IX. RECOMMENDATIONS AND ASSURANCES ........................... 40

ANNEXES

ANNEX 1 - Foundry Process for Pumphead Production

ANNEX 2 - Agricultural ProductionChart 1 - Length of Rainy Season (Records 1934-69)

2 - Seasonal Cropping PatternsTable 1 - Present Adaptation of Cropping Pattern to Land and Soil

2 - Bi-Monthly Irrigation Requirements for Paddy Nurseries(in inches)

3 - Bi-Monthly Average Field Irrigation Requirements4 - Summary of Bi-Monthly Field Irrigation Requirement

(in inches of water)5 - Relationship between Pump Discharge and Water Table Depth6 - Cropping Systems by Land Elevation With and Without HTW7 - Calculation of Pumping Requirements per Acre8 - Per Acre Labor Requirements9 - Family Manpower Utilization in HTW Operation10 - Crop Inputs and Yields Per Acre11 - Labor Requirements by Month (man-hours)12 - Calorie Input/Output Analysis13 - Annual Incremental Input Requirements at Full Development

ANNEXES

ANNEX 3 - Farm BudgetsTable 1 - 1 acre Farm Budget - Model I

2 - 1 acre Farm Budget - Model II3 - 1 acre Farm Budget - Model III4 - 1 acre Farm Budget - Model IV

ANNEX 4 - Project CostsTable 1 - Phasing of HTW Distribution

2 - Cost of 1 HTW3 - Spare Parts Cost and Replacement Schedule4 - Project Staffing5 - Incremental Staffing Costs6 - Vehicles and Equipment Costs by Agency for IRDP

and DPHE7 - Investments and Operating Costs for IRDP and DPHE8 - Costs of Center Store at Natore9 - Costs of Toolkits10 - Training and Publicity Costs11 - Research and Testing Component12 - GOB Net Contribution to Project Costs

ANNEX 5 - Financial and Economic AnalysisChart 1 - Locus of Benefit-Cost Switching ValuesTable 1 - Financial and Economic Prices

2 - Price of Internationally Traded Commodities, 1982-90 Averagefor Economic Analysis

3 - Economic Benefit and Cost Streams

ANNEX 6 - DisbursementsTable 1 - Disbursement Schedule

2 - Detailed Disbursement Allocation

ANNEX 7 - CreditTable 1 - Incremental Medium Term Credit Requirements

2 - Seasonal Flow of Funds3 - Credit Operations

ANNEX 8 - Working Papers and Documents in Project File

MAP - IBRD 15454

BANGLADESH

HAND TUBEWELLS PROJECT

I. INTRODUCTION

1.01 The Government of Bangladesh (GOB) has asked IDA for assistancein financing a nationwide, hand tubewells project designed to increase theirrigated area, production and incomes of small farmers and sharecroppers.The project would be a follow-up to a successfully completed UNICEF project.

1.02 The first use of hand tubewells for irrigation arose spontaneouslyfrom the UNICEF-supported Rural Water Supply Program, which supplied more than350,000 village drinking water pumps throughout the country over a 15 yearperiod. Farmers rapidly recognized the potential of these pumps for small-scale irrigation and, in response to this clear demand, a UNICEF MOSTI 1/project started with the Integrated Rural Development Program (IRDP) in 1975.Encouraged by the excellent response from farmers the project was extendedthrough 1979 by which time almost 90,000 hand tubewells had been sold. Thereremains considerable unsatisfied demand for hand tubewells by small farmersthroughout the country, but financial constraints have curtailed the UNICEFprogram.

1.03 The proposed project would build on the experience gained by UNICEF,IRDP and associated Government agencies and would greatly increase the numberof hand tubewells available to the small farmers of Bangladesh. The projectwas prepared and appraised in September 1980 by a mission consisting of Messrs.W. A. Ward, J. A. Hayward, R. Moreno (IDA) and M. Maasland (Consultant).

II. BACKGROUND

The Agricultural Sector

2.01 Agriculture dominates the Bangladesh economy, accounting for 55%of GDP, 70% of total employment and more than 80% of the country's exports.About 74% of agricultural GDP (in FY80) derives from crops and the rest fromforestry (6%), fisheries (8%) and livestock (8%). Of a total population ofalmost 90 million, about 75 million live in 68,000 villages and comprisefarmers, 59%; agricultural laborers, 25%; and others 16%.

2.02 Bangladesh has a gross area of 35.3 million acres, of which about4.0 million acres are perennial water, 5.7 million acres are state-ownedforests and 2.4 million acres are denuded forest lands subject to shifting

1/ The term 'MOSTI' (Manually Operated Shallow Tubewell for Irrigation) hasbecome the accepted name for all hand tubewells used for irrigation inBangladesh.

-2-

cultivation. Virtually all arable land is under cultivation. About 22.5million acres are cropped at a cropping intensity averaging about 140%. Rice,by far the most important crop, accounts for about 80% of the gross croppedarea; jute (the principal export) for 6% and a variety of other crops such aswheat, pulses, oilseeds, sugarcane and vegetables for the remainder. Agricul-tural productivity in Bangladesh is among the lowest in the world, the averagepaddy yield being about 0.5 ton per acre.

2.03 Over 80% of all rural households in Bangladesh own less than 3 acres;the land ownership distribution is highly skewed. Four percent of householdsown 32% of the land, while 45 percent of households own 8% of the land. Fifty-four percent of the rural population is virtually landless, owning less thanhalf an acre. The proportion of rural landless is growing rapidly.

2.04 In spite of having large areas of fertile deltaic soils, temperaturessuitable for year-round cropping, and abundant labor, Bangladesh has been afood-deficit area for more than 20 years. During the 1960s, agricultural out-put rose at an average annual rate of 2.5% and foodgrain production at about2.4% per annum; both lagged behind a population growth of 2.8% per year. Asa result, annual foodgrain imports required to meet domestic consumption haveincreased to over 1.5 million tons.

2.05 The main thrust of Government's agricultural development strategyin the Second Five-Year Plan (1980/81 to 1984/85) is to achieve and maintainfood sufficiency in the country. Without this there is no prospect for morerapid overall growth of the economy. Government's recognition of this prior-ity is shown by various recent measures to step up agricultural growth andrationalize food policies. The formulation of a detailed Medium-Term Food-grain Production Plan (MTFPP), increased budgetary allocation to agriculturaldevelopment, increased recognition of the private sector's role in the provi-sion of inputs, provided more effective price support policies and strengthened.agricultural planning; factors which make it possible to foresee a more rapidgrowth in agriculture.

IDA Operations in the Agricultural Sector

2.06 The focus of IDA assistance to Bangladesh in recent years has beenon agriculture. This is consistent with Government policies. In addition toassisting in the preparation of the MTFPP, IDA is involved in a major programof financing agricultural and rural development (15 of the 40 new projectsapproved since independence, and two fertilizer import credits).

2.07 Seven projects involve irrigation and a further eight the develop-ment of agricultural extension services, agricultural research, jute cultiva-tion, the seeds industry, inland fisheries, grain storage, area-based ruraldevelopment, and drainage and flood control. Of the irrigation projects,two involve the utilization of groundwater: the Northwest Tubewells Project(Credit 341-BD, 1972, US$14.0 M), irrigation for about 180,000 ac; the ShallowTubewells Project (Credit 724-BD, 1977, US$16.0 X), irrigation for about150,000 acres. The implementation of these projects has involved substantialdelays due largely to logistic problems in procurement. The Government has

- 3 -

taken steps to remedy the most serious bottlenecks and both IDA and Governmenthave increased emphasis on monitoring and supervision which has resulted innoticeable improvements in implementation.

Crop Production, Constraints and Potential

2.08 Agricultural production in Bangladesh is constrained by scarcity ofcultivable land, climatic hazards, lack of irrigation facilities and deficienttransportation for moving farm inputs and harvest. About 90 percent of theland surface is flat alluvial plain, mostly less than 10 feet above sea level.Annual rainfall, which ranges from 50 inches in the southwest to over 200inches in the northeast, follows a typical monsoon pattern; usually there iseither too much or too little water. Monsoon rains start in May and end inOctober and the great rivers rise causing extensive flooding. During the longdry season (November to April) the river levels are low and severe droughtconditions often prevail.

2.09 These constraints on agricultural development can, however, be overemphasized. Bangladesh has extensive areas of highly fertile deltaic soils,and an abundance of good quality groundwater for dry season irrigation. Thedevelopment of high yielding varieties (HYVs) of rice and wheat suitable forcultivation over large areas of the country, in conjunction with irrigation,has opened up the prospect of substantial increases in production that can bebrought about quickly and inexpensively. Much of the potential, however, hasyet to be exploited.

2.10 The heavy pressure of population on land represents a major develop-ment constraint. It is estimated that only about 25 percent of rural house-holds own more than 2 acres, the minimum holding necessary to provide subsis-tence income at present production levels. A typical holding may be fragmentedinto 5 or 6 plots which constitutes an obstacle to efficient farm managementand makes the organization of cooperative irrigation systems difficult. Anadditional constraint faced by about 30 percent of Bangladesh farmers is thatthey are forced to rent land to supplement their own production. Sharecroppingtenants are expected to provide all inputs but receive only half of the cropand have no right of occupancy. For such tenants there is little incentive toincrease farm production.

2.11 The most important influence on agricultural practices in Bangladeshis risk aversion. Traditional farming methods have evolved over time withstarvation the penalty for crop failure. Subsistence farmers are highly recep-tive to proven innovations which do not increase their risks, but rejecttechnology of high potential but with high associated risk. Once farm produc-tion increases to provide a food surplus the willingness to accept risks forthe promise of greater reward also increases.

2.12 Within the MTFPP, the single most important contribution to increasedfoodgrain output is to be made by the provision of additional irrigationfacilities which will make grain production less vulnerable to the uncertain-ties of rainfall. Newly irrigated area alone is targeted to contribute some 3million tons in additional grain output by FY85; in addition, the utilizationof irrigation facilities to supplement the natural supply of water for rainfed

crops is expected to add some 500,000 tons per annum to gross output. GOBrecognizes that to achieve thes.e targets a major effort will be required to

overcome the critical shortage of irrigation equipment.

Cropping Patterns

2.13 Cropping systems and sequences, as well as planting dates for mostcrops, are directly dependent upon the supply and amount of rainfall, surface

water or groundwater available. The seemingly flat land of much of Bangladesh

masks substantial localized variation in land elevation to which farmers arecompletely sensitive. The relative degrees of flooding, the likely availabi-

lity of residual soil moisture, and thus the potential of each plot of landis known to the landholder and the cropping pattern precisely geared to land

capability.

2.14 Three main paddy crops are grown in Bangladesh:

(a) Aman - the main monsoon crop either long season (220-250days) broadcast (B. Aman) on premonsoon rains inMarch/April, 1/ or short season (150 days) (T. Aman)sown in nurseries in June/July and transplanted 1month later;

(b) Aus - short season (120 days) varieties either broadcast(B. Aus) or transplanted (T. Aus) in March/Apriland harvested in July/August; and

(c) Boro - varieties grown in rabi (dry season) with irriga-tion.

Both Aus and Aman may be grown from broadcast seed or transplanted; the trans-planted crops give higher yields. Boro is sown in nurseries from November

to January, transplanted about one month later and harvested in May/June. Boroencounters few natural hazards, and when adequate water is assured, it is the

highest yielding paddy. HYV Boro yields an average 35-40 md of paddy per ac

but is capable of much higher productivity where good management and recom-mended fertilizer levels are applied. Extensive demonstration yields averageover 80 md per ac and research yields can more than double this figure.

Because of uncertain rains, disease, limited fertilizer use, and a high degreeof lodging, yields of local Aus and B. Aman are very low compared with HYV

Boro and T. Aman. Without reliable supplementary irrigation to overcomepost-monsoon drought during flowering and ripening stages and control of watermovement to prevent nutrient losses, farmers are reluctant to invest in

fertilizer and pesticide for T. Aman, either local varieties or HYV, and

average yields are well below the potential for this crop.

2.15 The most common cropping sequence is Aus and/or Aman followed, whereirrigation is available, by Boro or wheat, vegetables, pulses and oilseeds in

1/ About 15% of this crop is planted in deep water areas; this "floating"rice is planted earlier, in February/March.

-5-

the dry cooler season. A cropping intensity of about 150 percent is usualbut in the most favored areas higher intensities are feasible. In small plotsnear homesteads with irrigation, the inclusion of short season vegetables andpotatoes in the cropping sequence, make cropping intensities of 250 percentachievable. Where, however, farmers have no access to irrigation and haveland which is deeply flooded during the monsoon season, only a single crop(usually B. Aman) can be grown per year. Some land floods so deeply and driesso rapidly that it is unsuitable for cropping and is used for grazing at theend of the rains.

III. IRRIGATION

Strategic Importance of Irrigation

3.01 For centuries Bangladesh farmers have used bucket-lift methods forirrigating dry season crops on lands near low-lying water and perennial streams.Until the late 1950s, however, few further efforts were made to develop waterresources and the irrigated area remained stagnant at around I M ac. By theearly 1960s population pressure had increased and virtually all arable landwas under cultivation.

3.02 Increases in production can only come from increases in croppingintensity and yields. At present the cropping intensity is determined by thelength of the monsoon season and the uncertainty of residual soil moisture.Similarly, yields are determined by input usage which reflects farmers confi-dence in a reliable water supply. Farmers whose lands are flooded in themonsoon may experience severe drought during the dry season or, more critic-ally, during breaks in the monsoon. The Bangladesh farmer faces a never-endingseries of unpredictable changes in water availability and the risks and uncer-tainties are enormous. Not unreasonably, there is widespread unwillingnessto commit scarce capital to inputs, and yields remain very low.

3.03 The strategic importance of irrigation to Bangladesh is immense.Not only would an assured water supply throughout the year guarantee greaterfood production but it would change farmers' attitudes from resignation andrisk aversion to a sense of security and advancement.

Groundwater Resources

3.04 Groundwater constitutes the major source of water available tomost areas where irrigation from surface sources is difficult or impossible.Flexibility of supply gives it special importance since groundwater suppliescan meet cropping needs during the dry season when surface flows are at aminimum and irrigation requirements high.

3.05 The presence of accessible groundwater throughout most of Bangladeshcan be attributed to two principal factors: high rainfall and favorablegeology. With a minimum annual average rainfall of 50 inches in the west,

- 6 -

increasing to 200 inches or more in the northeast, the importance of rainfallin recharging the groundwater is obvious. In addition, the generally flatterrain, coupled with the large areas of bunded rice paddies, pervious soilsand permeable underlying sediments, is favorable for water percolation.

3.06 BWDB, BADC, DPHE and TTDCs have compiled data on wells drilled forirrigation, municipal and domestic supply. The performance of the wellsvaries considerably due to differences in aquifer characteristics, method ofwell construction and development, and well design. Evidence from many hun-dreds of test-wells shows that the entire area of Bangladesh is underlain bygroundwater with water table depths ranging from zero to 30 feet, dependingupon location and season. It is clear that high-yielding wells can be in-stalled practically everywhere except in the complex geological areas of thenortheast, in the Barind area in the northwest and in the coastal belt, wheresaline intrusion limits groundwater development.

3.07 With the exception of limited low rainfall areas in the west, thepotential rainfall recharge of some 50 million acre feet (MAF) is sufficientto support full development of irrigated agriculture on some 16 million 1/acres of cultivated land for most of which surface water supplies are notreadily available. Aquifer conditions are also satisfactory for tubewelldevelopment in most of these areas.

3.08 The groundwater system in Bangladesh is in dynamic equilibrium--that is, annual recharge is approximately equal to the discharge. Rechargeexceeds discharge during the rainy season and groundwater levels rise; butduring the dry season discharge exceeds recharge and groundwater levelsdecline. In many parts of Bangladesh groundwater reaches the land surfacetowards the middle of the monsoon after which a significant amount of poten-tial recharge rainfall is rejected. If the initial groundwater level werelower, a greater part of the rainfall would infiltrate. This recharge poten-tial will be realized when tubewells lower the groundwater table at the endof the dry season. The maximum water table levels will only change wherenet annual groundwater withdrawals exceed recharge.

3.09 Although the monsoon rainfall is more than sufficient to rechargeaquifers depleted by any expected irrigation offtake, local fluctuations ofthe water table during the dry season are of considerable significance to handtubewell usage. Not only does the water table gradually recede during the dryseason but the "drawdown effect" of DTWs and STWs can be substantial. Where aDTW (drawing 2 cusec) or to a lesser extent a STW (drawing 0.5 cusec) is inoperation, a cone of depression is created in the water table. Within thiscone the water table may be too deep for hand tubewells to operate. To avoidsuch interference between DTWs, a spacing policy has been initiated whichspecifies a minimum spacing of 1-1/4 miles between DTWs. This policy shouldalso minimize the risk of over development of groundwater in the near future.

1/ From Bangladesh: Land and Water Resources Sector Study, Volume VII,IBRD Report No. PS-13, 1972. The "conservative estimate of 4 M ac"reported in the same report greatly underestimates groundwater potential.

-7-

The Exploitation of Groundwater through Minor Irrigation

3.10 The Second Five Year Plan's agricultural and rural development stra-tegy, supported by IDA, places special emphasis on increasing the productivityof the small farmer and on generating employment opportunities through thefinancing of low cost, quick yielding, labor intensive schemes. To supportthe plan GOB is taking steps to improve the supply of crop production inputs,including increased availability and access to short-term credit and medium-term credit for agricultural purposes. Increased domestic manufacturing toprovide more of the inputs needed for irrigation development is also expectedto contribute to greater labor utilization. The MTFPP focuses on increasingminor irrigation facilities by providing Deep Tubewells (DTWs) Shallow Tube-wells (STW) Low Lift Pumps (LLPs) and Hand Tubewells (MOSTI). The targets forthe Minor Irrigation Sector of the MTFPP are summarized below:

Minor Irrigation in the MTFPP

Target1980/81 1984/85

Number Acres Number AcresOperated Irrigated Operated Irrigated

Deep TWs 10,700 560,000 26,200 1,570,000Shallow TWs 23,400 220,000 130,000 1,625,000Low Lift Pumps 38,600 1,400,000 51,000 2,030,000Hand Tubewells 120,000 60,000 500,000 150,000

3.11 In the light of implementation difficulties faced in the past inlarge scale projects greater emphasis is being placed on easy-to-execute divi-sible projects where benefits rapidly follow investment. All minor irriga-tion projects fall within this category and are given highest priority inBangladesh.

3.12. The current minor irrigation technology based on DTWs, STWs and LLPsis suited to group operation rather than individual initiative. Command areasof DTWs (100 ac), LLPs (60 ac), STWs (15 ac) all demand farmer cooperation inwater usage and in group decisions on cropping patterns. Social constraintsare still a major factor in limiting command areas to well below theoreticaloptima. Hand tubewells, however, discharging about 8-10 gpm and capable ofirrigating between 1/3 ac and 1/2 ac, depending upon crop and soil conditions,use largely family labor, and are ideally suited for catering to the individualneeds of the small farmer with a fragmented holding. Hand tubewells are inex-pensive, easy to operate and maintain, and can be manufactured domesticallyand, in some cases, installed by the farmers themselves.

The Hand Tubewell Program

3.13 Following farmers' spontaneous use for irrigation of hand tubewellssupplied by UNICEF for village drinking water, two hand tubewell projects werefinanced by external aid agencies during the First Five Year Plan. Thesewere:

- 8 -

(a) the Manually Operated Shallow Tubewells for Irrigation (MOSTI)project with UNICEF apsistance which started in 1975/76; and

(b) the Small Scale Irrigation Project (SSIP) with USAID assis-tance which started in 1977/78.

3.14 The UNICEF MOSTI project started as a pilot project with the Integ-rated Rural Development Program (IRDP) to install 10,000 hand tubewells inthe 1975/76 irrigation season. Encouraged by the excellent response fromfarmers, the program was extended through July 1979; and 87,770 MOSTI hadbeen sold when the project was completed; there was still substantial unsatis-fied demand.

The MOSTI Project Performance

Year Target Actual Sales

1975/76 10,000 9,2201976/77 20,000 22,0001977/78 30,000 30,1001978/79 30,000 26,450

Total 90,000 87,770

Of the above MOSTI, 25% were sold for cash, and the remainder with medium-termcredit support. The distribution of MOSTI was arranged by each participatingTCCA through the affiliated KSS 1/ and only farmers owning less than threeacres of land were qualified to buy hand tubewells. However, non-members werepermitted to purchase MOSTI at a 5% higher price.

3.15 While tendering for raw materials and accessories was done by UNICEF,importation, storage and delivery and local fabrication of pump heads wereorganized by the Department of Public Health Engineering (DPHE) based on theirexperience in the UNICEF aided drinking water supply program. No additionalstaff were employed by either agency to execute the MOSTI project.

3.16 Loan recovery performance for the medium term (18 months, 13% interest)loans given to KSS members for the purchase of MOSTI was satisfactory. Of theTk 4.42 crores due by October 1979, Tk 3.5 crores had been remitted to IRDPheadquarters by TCCAs and recovery at field level was over 90%.

1/ The TCCA/KSS Cooperative System is an organization in which village agri-cultural cooperative societies (KSS) of 40-60 landowners are federatedinto a Thana Central Cooperative Association (TCCA). The KSS collectthrift deposits, introduce group management of irrigation equipment andprovide institutional credit, to overcome handicaps of small and frag-mented holdings, small individual surpluses and small input requirements.There are presently 270 TCCAs and 40,000 KSSs. TCCA/KSSs are classifiedon the basis of their performance in achieving their objectives (coverageof farm families, loan recoveries, build up of thrift savings, income/expenditure ratios, attendance at meetings, regularity in accounts andaudits). The highest classification is A; the lowest E. Approximately46% of KSS are classified as A or B.

- 9 -

3.17 The Small Scale Irrigation Project (SSIP) executed by BADC under aUSAID credit aimed to sell 240,000 hand tubewells during the three year period1978 to 1981. About half of these were to be sold on a cash basis through BADCzonal stores or private dealers and 60,000 hand tubewells each were to be soldthrough TCCA and BKB. While BADC and BKB have not applied restrictions onownership of land by purchasers of hand tubewells, the TCCA nominally followedthe UNICEF M4OSTI project criteria of selling only to farmers owning less thanthree acres of land, though a follow-up study of UNICEF MOSTI project by IBAindicated that the average landholding of MOSTI farmers was about 4 acres. 1/

3.18 The SSIP project, in common with many BADC operations, encounteredconsiderable delays through logistic difficulties in procurement--in this case,of raw materials and accessories. By October 1980 only 7,500 hand tubewellshad been made available under SSIP. Of about 2,000 units allocated to TCCAand BKB, and 3,462 to BADC's distribution channel, TCCA had rapidly sold theirentire allotment, whereas BADC and BKB had sold only 55% and 75% of theirallotments, respectively. Another 50,000 pump heads (locally manufactured)had been procured by early October 1980 but the necessary accessory pipes andstrainers had not been imported. Because of cost escalation, the program wasreduced to 150,000 units.

3.19 Experience gained from the UNICEF MOSTI program indicated that:

(a) MOSTI sales move much faster when medium term credit andequipment supply are linked together and are available tothe farmers at a single point such as the TCCA/KSS (IBAReport);

(b) MOSTI can often be installed and lifted by farmers, canbe moved from one location to another with relative ease,and are used seasonally for drinking water as well as forirrigation;

(c) the need for additional staff in the agencies involved toexecute a MOSTI program is minimal (Annex 4, Table 5); and

(d) performance of DPHE has been acceptable.

Area Suitable for Hand Tubewells

3.20 The MTFPP anticipates 7.2 M ac being irrigated from groundwaterby 1984-85. This is more than double the existing irrigated area yet stillleaves at least half of the potential irrigable land without irrigation.There is clearly great potential for further expansion of the hand tubewellirrigated area.

3.21 The limits of hand tubewell usage are determined by maximum watertable depth which should not exceed 18-20 feet. Maximum water table depthmeasurements for the year 1979, when there was a severe drought, indicated

1/ Institute of Business Administration, University of Dacca. ManuallyOperated Shallow Tubewell for Irrigation in Bangladesh: March 1980.

- 10 -

five areas where deep-set wells would be essential (Map 15454R). In normalyears the water table declines to only 10 feet or less below land surface inmore than half the country and the maximum water table depth of 18 feet occursin 75% of Bangladesh. Even in the severe drought of 1979, hand tubewellscould have been safely used in at least 7 M acres.

Marketing of Hand Tubewells

3.22 Hand tubewell equipment is usually sold at retail as a set composedof pumphead, pipe and strainer. Foundries sell finished pumpheads throughthree channels: private agents, the MOSTI Project channels, and the SSIPProject channels. Practically none of the MOSTI pumps 1/ are sold throughprivate dealers because of the subsidized price offered by the MOSTI and theSSIP Projects (para 3.32). A smaller pump 2/ is marketed through privatedealers, who add the required pipes and strainer before selling to the finaluser at prices ranging from Tk 320 to Tk 375 for the pumphead, Tk 300-500per 20-foot length of pipe, and Tk 150 for a six-foot strainer (without coirwrapping).

3.23 Marketing channels for the SSIP and MOSTI Projects are essentiallythe same. All hand tubewell equipment in the MOSTI Project and most of theequipment in the SSIP Project are marketed through the TCCA/KSS system.Orders are taken by the cooperatives and consolidated by IRDP. Availablesupplies are allocated to the TCCA's by IRDP headquarters in Dacca. MOSTIequipment is supplied to these TCCA's out of the DPHE Central Stores atChittagong, Dacca, and Khulna. SSIP equipment is supplied to the TCCA's outof the BADC zonal stores. In addition to sales through private dealers andBangladesh Krishi Bank (BKB), it was planned under SSIP to sell approximatelyhalf the available equipment on a cash basis through BADC zonal stores orprivate dealers and the remainder on 18-month credit at 13 percent interestthrough TCCAs and BKB. Sales on credit through TCCAs moved much more readilythan those through BKB and from BADC zonal stores; as a result BADC reallocatedthe 1979/80 private dealers allotment for sale through TCCA's, which were ableto sell quickly the increased allotments.

Credit to UNICEF MOSTI Purchasers

3.24 Approximately 75% of the MOSTI sold under the UNICEF project weresold on MT credit at 13% interest with the credit repayable in 3 equal semi-annual installments. Farmers could obtain MT credit either by borrowingthrough their KSS/TCCA or through Government commercial banks. Farmers preferto borrow through their own cooperatives because fewer steps are involved inloan processing, the MOSTI equipment is available at the same site, and farmersare more comfortable dealing with their own organization than with commercialbankers (IBA Report). Lending channels for both MT and ST credit through the

1/ The pumphead used for the MOSTI is the No. 6 pumphead; it has a dischargeof about 8-10 gallons per minute.

2/ This pumphead is also known as the No. 4 pumphead and has a dischargeof about 5 gallons per minute.

- 11 -

cooperative system are well developed and are continuing to improve. However,the terms of the MT and ST credit have not been geared to the needs of thesmall, food-deficit farmers which are the target group for the MOSTI program.

Demand for Hand Tubewells

3.25 Because sales of HTWs have always been constrained by supply, thedemand for HTWs can not be ascertained directly by observing past sales.Nevertheless, the unsatisfied demand for HTWs is believed to be substantial.The magnitude of potential sales can be estimated from the factors whichcontribute to demand for HTWs, discussed below.

The market for hand tubewells can be segmented in several ways:

(a) Demand arising from farmers who wish to utilize HTWs forfamily drinking water safety and convenience;

(b) Demand by farmers for HTWs to be utilized in growing high-value crops such as vegetables and pulses on parts of theirfarms utilizing hired labor; and

(c) Latent demand by small, food-deficit farmers who have excessfamily labor during the dry season but who lack resources tobuy HTWs and related inputs without favorable medium andshort term credit respectively (paras 3.27, 4.20).

3.26 The UNICEF project distributed 87,800 MOSTI over a four year periodutilizing MT credit which was repayable over eighteen months. The 1980 IBAstudy of the UNICEF MOSTI project indicated that the project scarcely touchedthe poorest farmers, group (c) above. Average arable land holdings of MOSTIfarmers was 3.86 acres; more than half of the participating farmers usedtheir MOSTI for drinking water only; one fourth of the sales were for cash,and many of the credit sales were to farmers who could have paid cash but didnot because the IRDP-TCCA policy of the time was one of charging a higherprice for cash than for credit sales. The UNICEF MOSTI project reached inlarge part the relatively older and wealthier of the mid-size farmers (IBAreport, pages 47-50), because of the lack of a viable MT and ST credit packagefor the smaller farmers. Still, demand for hand tubewells even among the for-mer groups exceeded the ability of the UNICEF MOSTI project to supply pumpsets.

3.27 The major constraint on the purchase of MOSTI by small food-deficitfarmers has been credit availability. This point is strongly supported byfarm budget analysis (Annex 3) and by analysis of the UNICEF MOSTI projectresults. These suggest that spreading the repayment of the loan for thepurchase of hand tubewells over three years rather than eighteen months wouldconsiderably improve the ability of smaller farmers to bear the repaymentobligations. Also, the initial seasonal outlay for crop inputs is substantialand short term credit must be made available to encourage HTW uptake by thesmall farmer. With an assured source of short and medium term credit atvillage level through the existing TCCA/KSS system together with a constantsupply of hand tubewells and spare parts, there is every justification forbelieving that HTWs will reach the small farmers and that the MTFPP target ofan additional 380,000 to be installed during the period 1980-85 is conservative.

- 12 -

Domestic Manufacture of Hand Tubewells

3.28 All pumpheads for hand tubewells are made within Bangladesh. Thefoundry sector is composed of several dozen small foundries and about 40medium sized firms which produce pumpheads more cheaply than importablesubstitutes. The pig iron and coke for the production of the pumpheads, aswell as GI pipes, are imported. DPHE takes delivery of pig iron, coke and GIpipes at the Ports of Chalna and Chittagong and supplies the required quanti-ties of raw materials (80 lbs pig iron and 20 lbs coke per pumphead) to con-tracted foundries (para 6.07).

3.29 A survey conducted by UNICEF identified about 30 foundries with thecapability and interest to manufacture pumpheads. Contracts were let to nineof these foundries during 1975-80 and all performed satisfactorily althoughsome had initial difficulties meeting UNICEF's quality standards. The capacityof these nine foundries alone exceeds 300,000 pumpheads per year which greatlyexceeds the planned procurement of the national hand tubewell program.

3.30 The foundry sector is internally competitive, with very little cross-ownership of foundries. Most firms are family-owned or are partnerships. Thesmaller foundries are primarily family-owned and family-managed. The largerfoundries have a combination of owner-managers and professional managers,usually with a graduate engineer as production manager. Details of foundryprocedures are given in Annex I. Capacity is defined principally by castingbay area and cupola capacity, with casting area the more prominent constraint.Most foundries have spare capacity, with pourings occurring, at most, on alter-nate days on a one-shift basis. The larger firms in the sector have landavailable for casting bay expansion. Many of the smaller firms do not haveun-utilized land readily available, though most could increase the through-put of the existing casting bay area if faced by expanded markets for theirproducts.

3.31 Cost Structure of Hand Tubewell Manufacturing. Manufacturing costsfor cast iron pumpheads are dominated by variable costs (Annex 4, Table 2).By far the most important item of cost is raw materials--principally pig ironand coke, which accounts for 60% of the cost of a finished pumphead. Based ona calculated ex-factory cost of Tk 494 for a finished pumphead, variable costsaccount for approximately 90% of the price of the product, leaving only Tk 49for overheads (including selling expenses) and profits.

3.32 Supply Response and Gross Margins in Pumphead Fabrication. Variablecosts account for approximately Tk 446 of the ex-factory cost of Tk 494 for theMOSTI pumphead. Thus, the elasticity of supply of pumpheads at prices lessthan Tk 446 would be low or even zero. The existence of excess foundry capacityand the ease of capacity expansion indicate a fairly high elasticity of supplyat prices between Tk 446-494, and a very high elasticity of supply at pricesexceeding Tk 494 per pumphead, ex-factory. Under the SSIP Project, the retailprice of a pumphead with strainer was Tk 400 (pipes were sold for Tk 300 per20 ft section), which was less than the variable costs of manufacturing thepumphead alone. Thus, foundries have not attempted to produce the No. 6pumphead for the private market because of their inability to compete withthe Government's subsidized price. Instead, foundries have produced a smaller

- 13 -

and lighter pumphead (No. 4) which they have privately sold for Tk 320-375 perunit (September 1980 prices). The lighter pumpheads have been sold throughprivate dealers without credit support and have been used mostly for familydrinking water because of their low yield of water and resulting limitedutility for irrigation. Because of the partial substitutability between thetwo pumps, the subsidized price of the MOSTI pumphead has forced the foundriesto accept low gross margins on the smaller pumphead and to limit its sales toa narrow portion of the handpump market (cash customers who can afford personaldrinking water wells and do not wish to wait for MOSTI or SSIP equipment).The tIOSTI pumphead has been produced primarily under GOB contracts for theSSIP and MOSTI Projects and for the village water supply program. Excesscapacity in the foundry sector has also led the foundries to accept low grossmargins on these contracts.

3.33 Procurement of Raw Materials for Pumphead Fabrication. The majoritems of raw material for production of hand tubewell pumpheads are pig ironand coke, both of which are imported. A third item, scrap iron, is procuredlocally, though there is a persistent shortage in the country (para 3.35). Inmany cases, much of the scrap used comes from the foundries' own operations.Pig iron and coke are imported and distributed to foundries through threesources: Direct import by the larger foundries under import licenses issuedthem by Government; Import by the Trading Corporation of Bangladesh (TCB) basedon orders placed with them by the foundries; Import by UNICEF/DPHE under thevillage water supply and UNICEF MOSTI projects and distribution to the foun-dries on the basis of contracts for the supply of pumpheads to these projects.

3.34 Few foundries are able to acquire import licenses entitling them todirectly import raw materials and in the quantities they desire. In addition,TCB procedures are slow and bureaucratic, and foundries can not import pigiron and coke through TCB in the quantities and at the times they would like.A chronic shortage of pig iron and coke constrains the foundry sector andrestricts the supply of all cast iron products in the country. The problemof shortages of imported raw materials arises out of the acute scarcity offoreign exchange in Bangladesh and is not limited to pig iron and coke.

3.35 Foundries are also plagued by a scarcity of scrap iron. However,scrap iron seems to pose less of a constraint to foundry operations than doesthe shortage of pig iron and coke. The scrap iron scarcity manifests itselfin higher prices for the material in the local market rather than as anabsolute shortage as is the case with pig iron and coke and contributes tolower wastage factors for pig iron (Annex 1, para 4).

3.36 Remaining inputs for pumphead fabrication consist of nuts, bolts,washers, steel pins, and steel rounds, none of which pose an insurmountableproblem at present. A shortage of higher quality imported nuts, bolts,washers, and steel pins began to emerge during 1980. However, the availabi-lity of cheaper, lower quality local substitutes reduces the problem to oneof more frequent replacement of these easily-serviceable parts. Because theircost is such a small part of the total cost of the pumphead, more frequentreplacement has an insignificant effect on the life-cycle cost of the pump.

3.37 Steel rounds for making the piston rod are purchased in the localmarket. Two sizes of rounds are required. The piston itself is made from 3/8

- 14 -

inch diameter construction grade rounds.The piston head which connects to the

pump handle is cut from 1-1/2 inch steel round in 3/8 inch slices which arewelded to the end of the piston rod and drilled to receive the bolt which con-

nects the piston rod to the pump handle. One ton of steel rounds is sufficientto make 2000 piston rods. Availability of steel rounds and steel pins does

not pose a problem for hand tubewell manufacturers at present and is notexpected to do so during the SFYP period.

Supply of Pipes and Strainers

3.38 Both GI pipes and polyvinyl chloride (PVC) pipes have been used forvillage water supply wells. However, PVC pipes are less suited for irrigation

wells for two reasons: (a) MOSTI are moved frequently and the PVC pipes willnot withstand being repeatedly pulled and resunk; and (b) because they are

moved from site to site, the MOSTI pump head is not set in concrete, and the

stresses caused by pumping are borne entirely by the pipe; consequently astronger pipe is required for MOSTI than for drinking water supply wells.Pipes for the SSIP project was supplied by the Government-owned National Tubes

Company, the only domestic supplier of GI pipe. Difficulty in maintainingtimely supply of pipe has been the major cause of delays in implementing theSSIP Project. The previous MOSTI Project procured pipe from foreign suppliersand experienced no difficulty in organizing timely delivery. While

domestically-produced GI pipe is likely to continue to present supply problemsduring SFYP, it is not anticipated that there will be any difficulty in pro-curing GI pipe internationally.

3.39 Three types of strainers were used in the MOSTI and SSIP Projectsand in the village water supply programme: imported PVC strainers, GI pipelocally-holed and wrapped with imported brass screen, and GI pipe locally-

holed and hand wrapped with coir rope. The PVC strainers are inexpensive andsuited to village water supply, but are not sufficiently strong to withstandfrequent pulling and resinking. Brass strainers, while sturdy, are verycostly and are suspected of early clogging due to corrosion resulting fromelectrolytic action between the GI pipe and brass screen. Coir-wrapped GIstrainers can withstand frequent pulling and resinking, though the inexpen-sive coir rope wrapping (approximately Tk 5 for one wrapping of a 6 ftstrainer pipe) must be replaced typically after each 1-3 pullings. Least-

cost analysis (at 12% interest) indicates that coir wrapped strainers exhibitthe lowest life-cycle costs of the three alternative strainers, in additionto meeting strength requirements. Neither internationally-procured GI pipefor holing nor locally-available coir rope are expected to present any supplyproblems during project life.

Important Aspects of Future Hand Tubewell Projects

3.40 The experiences gained during the UNICEF MOSTI project implemen-tation suggest that follow up hand tubewell projects should pay particularattention to the following aspects:

(a) Procurement. Given the considerable time lag between submis-sion of orders and arrival of materials at port, successfuland continuous project implementation requires adequate plan-

ning in the procurement and efficient distribution of importedproject inputs; and

- 15 -

(b) Credit. A major component to the successful distribution ofMOSTI under the UNICEF MOSTI project has been the availabil-ity of medium-term credit for the purchase of MOSTI at thepoint of sale. Improving the terms of the medium term creditis expected to significantly increase the accessibility ofhand tubewells to smaller farmers. It is also important toensure the availability of short-term credit for the purchaseof related agricultural inputs, so as not to choke off thedemand for HTWs by smaller farmers unable to bear these costson their own.

These important aspects have been dealt with in the project described in thefollowing pages.

IV. THE PROJECT

Project Background

4.01 Following completion of the successful UNICEF MOSTI project in 1979,GOB requested IDA to finance a second hand tubewell project. Under the UNICEFMOSTI project, approximately 87,800 hand tubewell sets consisting of pumphead,GI pipes and strainer were distributed, with peak annual sales of 30,100 unitsbeing reached during 1977/78. The completion of the MOSTI project left substan-tial unsatisfied demand especially amongst small farmers. The proposed projectwould seek to meet this unsatisfied demand.

Project Objectives and Target Group

4.02 The main project objectives would be to increase the irrigated area,production and incomes of small farmers and to provide safer domestic watersupplies. A secondary objective would be to encourage the domestic engineeringindustry to manufacture irrigation equipment.

4.03 The project is targeted at farmers with small land holdings and withsurplus family labor who lack access to other sources of irrigation waterduring the dry season. These farmers traditionally have been among the lastto benefit from agricultural programs. Short term credit would be made avail-able to enable small farmers to utilize their hand tubewells to the bestadvantage.

4.04 At no time did the UNICEF MOSTI project satisfy the substantialdemand for hand tubewells and the 87,800 units produced were rapidly sold torelatively larger farmers (para 3.26). The peak sales figure of 30,100 unitsin 1977/78 was limited by the availability of imported raw materials for pump-head production and not by limitations either in the DPHE/IRDP organizationor by constraints in the foundry sector (para 3.29). With the provision ofcomplete hand tubewell units together with medium and short term credit atTCCA/KSS level it is unlikely that hand tubewells will remain unsold. Therelatively small amounts of materials involved should present no major problemsto the experienced DPHE staff assisted by a small number of incrementalproject staff (Annex 4, Table 4).

- 16 -

Project Area

4.05 The hand tubewell equipment provided under the project would be soldnationwide in all IRDP Thanas having suitable groundwater conditions, i.e.:

(a) Sweet-water-bearing sand within sixty feet of ground surface;and

(b) Static water table within 20 feet of the surface during periodof peak irrigation requirements.

GOB proposes to expand the IRDP network to cover all Thanas by June 1981; thusall Thanas could participate in the MOSTI program subject to their meeting theabove physical conditions. Some areas of most Thanas are suitable for MOSTIdevelopment, and problems exist mostly in the coastal districts where theproblem is one of groundwater salinity rather than water table depth (Map15454R).

Project Description

4.06 The project would produce and distribute 180,000 hand tubewells overa three-year period. Pig iron, coke and pipes required to produce completepumpsets would be procured by DPHE under ICB. Pumpheads would be fabricatedby qualified foundries in Bangladesh under contracts with DPHE (paras 6.06 and6.07). Complete pumpsets would be distributed by DPHE from District Stores atKhulna, Dacca and Chittagong and from a new store at Natore, to be constructedunder the project, to TCCA's from which they would be sold to farmers. Mediumterm credit would be made available for MOSTI purchase (para 6.11). Theproject would finance a research and testing program focussed on developing animproved hand tubewell design.

4.07 The project would be implemented over a 3-year period with phasingof MOSTI production as indicated below:

Number of HTWs to beYear Produced and Distributed

1981-82 40,0001982-83 60,0001983-84 80,000

Detailed Features

4.08 Importation of Raw Materials. The largest element of project costswould be the importation of raw materials--pig iron, coke and G.I. pipes.These materials would be imported by DPHE according to annual requirements(para 6.04).

4.09 DPHE has experience in international tendering and procurement as aresult of its activities in water supply. Detailed procedures and timetablesfor procurement were established, tested and used under the MOSTI Project by

- 17 -

UNICEF and would be employed, with some adaptation, by DPHE. Thus, no prob-lems are anticipated in the international procurement of pig iron, coke andpipes. The annual requirements for raw materials would be as follows:

1981/82 1982/83 1983/84

Pig iron (ton) 1,455 2,183 2,910Coke (ton) 365 548 73020 ft length GI Pipes (No) 84,800 127,200 169,600

4.10 Distribution of Raw Materials and Pumpsets. The Project would pro-vide for the transportation of raw materials from ports at Chalna and Chittagongto the DPHE stores at Chittagong, Dacca and Khulna. DPHE would be responsiblefor contracting local firms for the transport of raw materials and G.I. pipes(para 6.04). The project would provide eight 5-ton trucks and two pick-ups tobe used by DPHE as back-up equipment in the event of non-compliance or break-down of contractors' equipment, to provide additional flexibility and tohandle small and short hauls not suitable for local contracting.

4.11 Fabrication of Pumpheads and Strainers. Contracts for the fabrica-tion of pumpheads and strainers would be let by DPHE to local foundries and tolocal machine shops. The pumphead design would be the 'improved' BangladeshNo. 6 hand pump, the same pump that is manufactured for village drinking watersupply and was used for the UNICEF MOSTI project. The strainer would be madefrom G.I. pipe slotted or drilled. Farmers who purchased pumpsets would windthe strainer pipe with locally-bought coir rope, available in village markets.Contract specifications for fabrication of pumpheads and strainers wouldinclude the amount of raw material (pig iron, coke and pipes) provided to thefoundries and the amount to be paid by DPHE for the finished pumphead orstrainer. Foundries would be responsible for the transport of raw materialsfrom DPHE stores to the foundries and machine shops and for returning thefinished products to DPHE stores.

4.12 Quality Control of Pump Manufacturing. Quality control of pumpheadmanufacturing would be the responsibility of DPHE. An Office of QualityControl would be composed of three staff. Under the previous MOSTI Project,quality control functions were the responsibility of DPHE with technicalassistance from UNICEF. Standards and procedures are well established (Proj-ect File). The Project would provide funds for technical assistance of 30man-months from an internationally-recruited expert on quality control infoundry operations (para 4.18). An assurance was obtained that the Officeof Quality Control would be established by January 1, 1982.

4.13 Storage Godown at Natore. The project would finance retroactivelythe construction of a DPHE storage godown at Natore. The godown would allowDPHE to provide a more dependable supply of pumpsets to TCCAs in the north westof the country at lower cost. Difficulty was experienced in the UNICEF MOSTIproject in supplying TCCAs above the confluence of the Brahmaputra and Gangesout of DPHE stores at Dacca and Khulna because of the problems caused by ferrycrossings and transport disruptions due to flooding along the two rivers.The new store at Natore would help to alleviate these distribution problems.

- 18 -

4.14 Training. The project would provide both procedural training forIRDP and TCCA staff and simple technical training for village mechanics andfarmers. Training of IRDP/TCCA staff would be carried out by senior IRDPstaff through programmes at BARD Comilla, BARD Bogra, RDTI Sylhet and IRDPheadquarters and would concentrate on procedures for project implementationand on techniques to be used in farmer training programs. Farmers purchasingHTWs would be trained by TCCA staff in maximizing irrigation efficiency whileusing their HTWs. Village mechanics would be trained by DPHE staff at selec-ted TTDCs in the installation, repair, and maintenance procedures of HTWs.Prior experience as mechanics or as carpenters would be a prerequisite forparticipating in the mechanics training program. Materials to be used in thetraining programs would be adapted from materials used in the UNICEF MOSTIproject. As part of the training some publicity, in the form of posters andbooklets, will be distributed. Past experience indicates that such informationconsiderably increases recognition by farmers of the existence, benefits, andavailability of HTWs for irrigation. Costs of the training component areestimated at $210,000 and are detailed in Annex 4, Table 10.

4.15 Provision of Tool Kits. The project would provide two types of toolkits; major kits and minor kits (Annex 4, Table 9). Some 400 major tool kitseach costing Tk 2,000 would be sold on MT credit or for cash and would enablea private team of mechanics (3-4 persons) to perform the installation ofthe HTWs and any major servicing required. Major tool kits would be madeavailable only to mechanics who had satisfactorily completed the mechanicstraining program. The total cost of major tool kits would be approximately$62,500. The project would also provide 2,000 minor tool kits (4-5 per KSSgroup) at about Tk 200 each for routine maintenance work on HTWs. Any memberof a KSS would be eligible to purchase a minor tool kit on cash or creditterms (para 4.19). Total cost of minor tool kits would be approximately$25,000.

4.16 Research and Testing. The project would finance a three-year programof research and testing of appropriate hand tubewell equipment with the objec-tive of finding and developing design improvements to increase the efficiencyof manual irrigation. Many manual pumps are available worldwide but have notbeen systematically tested in Bangladesh. A UNDP world wide program to searchfor and test improved hand tubewells for purposes of irrigation and watersupply has recently begun. 1/ Coordination between the Research and TestingCommittee and the UNDP program representative in Bangladesh is likely to leadto great savings in efforts to search for better models and to a more speedyimplementation of the research and testing component. Models suggested by theUNDP program should be considered for field testing under the project. Theresearch and testing program under the project would be carried out by theDepartment of Mechanical Engineering of the Bangladesh University of Engineer-ing and Technology (BUET) under the supervision of a Research and TestingCommittee (para 6.16) and would consist of five stages: (i) an internationalreview and survey to find manual tubewells with potential for irrigation underBangladesh conditions; (ii) a rapid laboratory and field evaluation of allappropriate types; (iii) minor modifications, if necessary, of the most appro-priate type; (iv) field testing, evaluation, and feedback from manufacturers

1/ Program number UNDP/GLO7.

- 19 -

and users; and (v) detailed presentation of the most appropriate design foradoption in follow up phases of hand tubewell projects. An assurance wasobtained that by November 30, 1981, Government will cause DPHE to have enteredinto a contract, satisfactory to IDA, with BUET to carry out the Research andTesting Program. The project would contract for ten percent (four man-daysper month) of two faculty members time and would provide for full-time employ-ment for three years of two graduate engineers. Six man-months of technicalassistance from an internationally-recruited expert on manual irrigationsystems would be provided during the first two years of the project (atUS$70,000). Costs of research and testing are estimated to be approximatelyUS$244,000.

4.17 Monitoring and Review. The project would provide financing forproject monitoring and review consisting of two elements: (i) continuous moni-toring of project progress and feedback of information to management; and (ii)a third-year joint review of the project by a team of IDA and GOB officialsassisted by one consultant. The project would provide an Assistant for Moni-toring and Reporting posted in the office of the IRDP Deputy Director forHTW (para 6.17) and one man-month of technical assistance from an inter-nationally-recruited expert on management information systems to assist insetting up the management information system (MIS) and assuring that the systemwas consistent with and fed information into the larger MIS being implementedagency-wide by IRDP. In addition, four man-weeks of consultancy would beprovided for the third-year review of the project to assist IDA (8 man-weeksof supervision) and GOB (16 man-weeks of MLGRD&C staff time) to appraisethe remaining demand for HTW and the technical and economic viability ofthe improved design pumpsets, developed and identified under the project and,if appropriate, to prepare a follow-up project (para 6.18). An assurance wasobtained that by January 1, 1982, a management information system will havebeen established within IRDP to provide continuous monitoring of projectprogress and feedback of information.

4.18 Technical Assistance. The project would finance the cost of inter-nationally recruited consultants to provide technical assistance on researchand testing (6 man-months), quality control of pumphead fabrication (30 man-months), a third year project review (one man-month) and to review and coor-dinate the management information system (one man-month). Assurances wereobtained that to provide these services GOB would employ consultants whosequalifications, experience and terms and conditions of employment were satis-factory to IDA. The total cost of technical assistance is estimated atapproximately US$386,400. 1/

4.19 Medium Term Credit. Medium term credit for the purchase of pumpsetsand tool kits by farmers and mechanics would be provided by the banking system(para 6.11) and would not be funded under the project. Credit for 90% ofpurchase prices of pumpsets and tool kits would be made available to TCCA

1/ Eight man-months of short-term consultancy at the rate of US$12,080 perman-month covering salary and fees (US$8,000), allowances (US$2,760),travel (US$1,010) and miscellaneous (US$310); and 30 man-months oflong-term consultancy at US$9,660 covering salary and fees (US$6,740),allowances (US$2,200), travel (US$410) and miscellaneous (US$310).

- 20 -

members and would be repayable in equal annual installments over a three-yearperiod rather than eighteen months as was the case under the UNICEF MOSTIproject. The Bangladesh Bank would provide funds for medium term credit tocommercial banks (such as Sonali Bank), who would onlend funds to the TCCA/KSSunder the existing IRDP credit program. Terms for onlending are detailed inAnnex 7, Table 3. Assurances were obtained that Government would ensure theavailability of medium term credit sufficient to meet incremental medium termcredit requirements of the project on terms and conditions satisfactory to IDAand would inter into an onlending agreement with financing bank(s), satisfac-tory to IDA. Incremental medium term credit requirements are estimated tototal $11.1 million 1/ (Annex 7, Table 1). An assurance was obtained thatmedium term loans for the purchase of pumpsets and tool kits would be repayablein annual installments over a three-year period at the prevailing rate ofinterest for medium term agricultural loans plus a 1% TCCA margin, in totalnot less than 13% per year (para 6.09).

4.20 Short Term Credit. Farm budget analyses (Annex 3) indicate the needfor short-term credit to permit farmers, and in particular the smaller ones,to realize project benefits. Therefore, incremental working capital require-ments of project farmers would be financed through short term credit to beprovided by Government. Estimated incremental short term credit requirementsduring project implementation are shown in Table 4.1. An assurance wasobtained that government would provide, through the existing production creditfinancing system, sufficient short term credit for the financing of incrementalon-farm working capital requirements of the project.

Table 4.1: SHORT-TERM CREDIT REQUIREMENTS /a(Tk millions)

Year 1 Year 2 Year 3

Short-term credit requirement - 24.0 67.0Repayment /b - 25.4Incremental ST Credit - 24.0 41.6

/a In current values./b By farmers through Bangladesh Bank at 6%.

Distribution of Pumpsets and Tool Kits

4.21 The TCCA's would collect orders for pumpsets and tool kits accordingto procedures established under the UNICEF MOSTI project (Project File), andwould forward summarized orders to the Project Management Unit in Dacca. TheAssistant Director for Distribution and Accounts would collate the orders fromTCCAs and in consultation with the DPHE Assistant Engineer for Distributionwould allocate available supplies on a quarterly basis, giving priority toClass A and B societies in the event of insufficient supply of pumpsets. TheDirector of Credit, Cooperatives and Marketing would notify the DPHE sub-projectmanagement unit and each TCCA of the number of pumpsets allocated to the TCCA.

1/ In 1980 terms.

- 21 -

The TCCA would contract with local transportation firms for shipping pumpsetsto the TCCA from stores designated by DPHE, to be collected during a specificperiod of time designated by DPIIE.

4.22 Up to twenty percent of the pumpheads produced under the projectwould be eligible to be bought back by the foundries which produced them.Foundries would be notified of the buy-back option prior to tendering. Theoption could be exercised by the foundry at any time before the contract dateof delivery to DPHE of the finished pumpheads. The price to the foundrieswould be the same as the TCCA sales price, minus a 17% marketing margin whichincludes transport costs averaging about 2% (para 4.23). Foundries would beallowed to market the pumpheads as they chose. Machine shops would be allowedto buy back up to 20% of holed pipes on the same terms as above. This buyback scheme is in line with the GOB policy to move toward privatization of theinput delivery system for minor irrigation and agriculture in general. Anassurance was obtained that foundries would be given the buy back option, andthat a provision for this option would be included in each contract.

Hand Tubewell Purchase Price

4.23 The price of a hand tubewell to farmers is expected to be aboutTk 1,320 1/ and Tk 1,660 1/ for a pumpset comprising two and three 20 ft.pipes respectively. The price structure is detailed in Annex 4, Table 2and includes a marketing margin of 17% on the ex-DPHE price. The ex-DPHEprice is based on full cost of raw materials, fabrication, and transport, netof taxes and duties. Since the average transport cost of pumpsets from DPHEto points of sale to farmers is about 2% of the ex-DPHE price, a net margin of15% on the ex-DPHE price is maintained. This margin is essential to permitthe private sector to engage in the marketing of pumpsets and to permit theTCCAs to become financially viable. Therefore, an assurance was obtainedthat a pricing formula for hand tubewells, based on full cost 2/ net of taxesand duties, and including a 15% margin net of costs of transport from DPHEto TCCA/KSS would be adopted, and that the prices would be reviewed and ifnecessary adjusted annually to account for changes in costs, and that theexisting practice of charging a higher price for cash than for credit saleswould be abolished. An assurance was also obtained that pumpsets sold tofoundries on the buy-back option would be sold at ex-DPHE full cost, net oftaxes and duties (para 4.22).

1/ In 1980 values.

2/ Full cost includes raw materials, fabrication and transport costs.

- 22 -

V. COST ESTIMATES AND FINANCING

Cost Estimates

5.01 The total cost of the three-year project is estimated at US$30.1 Mof which US$16.2 or 54% would be foreign exchange and US$7.5 M or 25% dutiesand taxes. Details of costs for the project components, summarized in Table5.1 below, are in Annex 4. Cost estimates for staffing, vehicles, equipment,civil works, and technical assistance are based on 1980 actual costs for com-parable items or services in Bangladesh. The cost of pig iron and coke usedin the fabrication of hand tubewells and the cost of GI pipes are based on1980 internationally-quoted prices for these items. Projections for theproject period indicate negligible changes in the real costs of these commo-dities. The pumphead fabrication cost is based on bids made in 1980 for theproduction of UNICEF MOSTIs. Physical contingencies included in the estimatesamount to about 5% of base costs and include 5% on pumpsets and 10% on vehiclesand equipment, maintenance, and civil works. Contingencies included forforecasted price escalation over the project period amount to 30% of basecosts plus physical contingencies. Price contingencies for local costs havebeen estimated on the basis of a 12% annual domestic inflation rate for theyears 1981 to 1984. Price contingencies for foreign costs have been calcu-lated using the following estimates of international inflation for the years1981 to 1984: 9%, 8.5%, 8% and 7.5%.

Financing

5.02 The proposed IDA credit of SDR 14.8 M (US$18.0 M) would financeabout 80% of the project cost excluding duties and taxes. It would cover thefull foreign exchange cost (US$16.2 M) and about US$1.8 M equivalent of thelocal costs. Over the project implementation period, farmers purchasing HTWsand tool kits on medium term credit would contribute a down payment equal to10% of the price net of taxes and duties and repay part of the medium termloan, equivalent to about US$1.9 M. (including the principal but excludinginterest payment). About 15% of farmers would purchase HTWs on a cash basis,contributing US$1.6 M during project implementation. GOB would finance thebalance of the project costs including taxes and duties (US$8.6 M). 1/ Fundswould be made available to the implementing agencies in the form of budgetaryallocations. The proposed project financing is summarized below:

1/ To the extent that farmers pay for the pumps over the project implemen-tation period, Government's burden in the financing of the project isreduced. Therefore, the GOB share in the Financing Plan is equal tototal project cost less IDA contributions, and less payments for cashand principal repayment made by farmers over the implementation period.To account for the gap between government outlays and receipt of paymentsby farmers, inflows from farmer payments are deferred by one year, andconsequently, government's share in financing increased correspondingly.

- 23 -

TABLE 5.1: TOTAL PROJECT COSTS

Total F.E.Year 1 Year 2 Year 3 Tk '000 US$ '000 US$ '000-Tk '000--------

Incremental ProjectStaffIRDP 18 18 18 54 3.3 -

DPHE 319 319 319 957 59.8

Vehicles and OfficeEquipment

IRDP 208 - - 208 13.0 7.4DPHE 3,939 - - 3,939 246.2 144.6

BuildingsDPHE Natore Store 600 - - 600 37.5 7.5

Operation & MaintenanceVehiclesIRDP 55 55 55 165 10.3 8.3DPHE 392 392 392 1,176 73.5 58.8

OfficesIRDP 15 15 15 45 2.8 1.4DPHE 35 35 35 105 6.6 3.3

Buildings 9 9 9 27 1.7 1.7

Hand TubewellsPig Iron 10,152 15,228 20,304 45,684 2,855.2 2,283.7Coke 1,608 2,412 3,216 7,236 452.3 376.9G.I. Pipes 44,604 66,906 89,209 200,719 12,544.8 7,840.8Fabrication 8,180 12,270 16,360 36,810 2,300.6 642.6Transport 1,772 2,658 3,544 7,974 498.4 398.7TCCA Marketing andAdm. Margin 6,971 10,456 13,942 31,369 1,960.6 -

Research and Testing 2,198 1,308 398 3,904 244.0 122.0

Technical Assistance 1,507 2,241 2,434 6,182 386.4 386.4

Training and PublicityCourses 645 883 1,105 2,633 164.6 -Materials 53 70 87 210 13.1 -

Publicity 120 180 240 540 33.8 -

ToolkitsMinor 100 133 167 400 25.0 12.5Major 200 350 450 1,000 62.5 62.5

Total Base Cost 83,700 115,938 152,299 351,937 21,996.0 12,359.1Physical Contingencies 4,220 5,596 7,442 17,258 1,078.6 607.9Price Contingencies 13,891 33,957 65,170 113,018 7,063.6 3,251.9

GRAND TOTAL 101,811 155,491 224,911 482,213 30,138.2 16,218.9

- 24 -

TABLE 5.2: FINANCING PLAN(US$ '000)

Total ProjectCosts including

Components Farmers GOB IDA Contingencies

IRDP- 30 20 50DPHE - 380 240 620HTW Production +Distribution 3,500 7,919 16,836 28,255

Research and Testing - - 314 314Technical Assistance - 500 500Training - 274 - 274Toolkits 17 18 90 125

3,517 8,621 18,000 30,138

5.03 Retroactive financing for expenses incurred after January 1, 1981,is proposed for preproject expenditures related to the ongoing construction ofa DPHE Center Store at Natore. Cost estimates are presented in Annex 4, Table8. The amount involved is small and IDA's share of the retroactive financingwould not exceed US$.03 M.

Procurement

5.04 The pig iron and coke used in the fabrication of pumpheads (US$3.31 M)as wells as the GI pipes (US$12.50 M) would be procured following ICB procedures,with a preference limited to 15% of the c.i.f. value of imported material orthe import duty, whichever is less, to local suppliers. The fabrication ofpumpheads and the holing of pipes for strainers would be carried out by localfoundries on the basis of contractual arrangements between DPHE and the found-ries. Contracts for fabrication would be let following local competitivebidding procedures satisfactory to IDA (US$2.30 M). Under this arrangementDPHE would provide foundries with the required amount of pig iron and cokefor a specified number of pumpheads, on the basis of fixed coefficients. Thefoundries would then supply DPHE with the pumpheads at the price specified inthe contract. Similarly, DPHE would provide machine shops with GI pipes whichwould be cut and holed by the machine shops at contractual price arrangements.Contracts for civil works are limited to the construction of the DPHE CenterStore at Natore (US$.04 M); such work is not suitable for ICB and has beenlet following GOB local competitive bidding procedures which are satisfactory.Contracts for vehicles and equipment (US$.35 M) costing more than US$50,000would be let following ICB: a preference limited to 15% of the c.i.f. priceof imported goods or the import duty, whichever is lower, would be extended tolocal manufacturers in the evaluation of bids. Items purchased under contractscosting less than US$50,000, either urgently needed or not suitable for ICB,would be procured through prudent shopping, following normal Government proce-dures of comparing prices from no less than three suppliers. The total amountof such purchases would not exceed US$500,000. Contracts for the transporta-tion of materials from the ports to the DPHE stores, and from the stores to the

- 25 -

TCCAs would be let following local procedures satisfactory to IDA (US$0.5 M).The balance of project costs would comprise incremental staff salaries (US$.06M), TCCA administrative and marketing margin (US$2.0 M), maintenance and opera-tion costs (US$.10 M), research and testing (US$.24 M), technical assistance(US$.39 M), training and publicity (US$.21 M) and contingencies (US$8.1 M).

Disbursements and Audits

5.05 Disbursements from the proposed credit are expected to be completedby December 31, 1984, approximately six months after the end of project imple-mentation. The estimated schedule of disbursements is presented in Annex 6,Table 1. Disbursements under the credit would cover:

(a) 100% of foreign expenditures for imported pig iron and coke(US$3.40 M);

(b) 100% of foreign expenditures for imported pipes, vehiclesand equipment or 100% of ex-factory costs for local goodsbought through ICB or 60% of local expenditures for importedgoods procured locally (US$10.10 M);

(c) 100% of expenditures for research and testing and technicalassistance (US$0.72 M);

(d) 70% of the cost of local fabrication of pumpheads followinglocal competitive bidding procedures (US$2.10 M); and

(e) 70% of expenditures for civil works (US$0.03 M). Retroactivefinancing from January 1, 1981 is proposed.

The unallocated portion of the credit, comprising contingencies (US$1.65 M),would be reallocated to the above categories as required. No disbursementswould be made against salaries and related administrative expenditures oragainst local training. The funds for MT credit and incremental ST creditwould be fully financed by Bangladesh Bank and Government Commercial Banksand disbursements would not be made against these items. Details of disburse-ments are given in Annex 6, Table 2.

5.06 Fabrication of pumpheads and pipe holing for strainers would involvenumerous small contracts. Disbursements for these items would be made againstconsolidated statements of expenditure. The supporting documents, includingcontract documents, would be retained by the executing agency and would beavailable for inspection to IDA. Disbursements for retroactive financing ofconstruction of the Natore Center Store would be made against contract docu-ments (para 5.03).

5.07 IRDP, in its capacity as the coordinating agency (para 6.01), hasprepared the draft project proforma (PP - a document based on which governmentapproval is obtained for a project) and the Annual Development Program (ADP--annual budget for release of funds by the government). Government funding ofthe project would be through the coordinating agency. TRDP would maintainseparate records of funds received under the ADP and released to the imple-menting agencies (IRDP and DPIIE). The implementing agencies have adequate

- 26 -

accounting procedures and would be required to prepare subproject accounts.An assurance was obtained that IRDP and DPHE maintain separate accounts ofexpenditures made under the project, irrespective of whether these would beeligible for IDA disbursement. Project accounts, which would be a consoli-dation of the subproject accounts, would be prepared by IRDP (see 6.19) andinclude:

(a) Project statement of source and application of fundsand balance sheet;

(b) Schedule of withdrawals under the credit, includingcategory, amount allocated, percentage to be financed,year-end expenditure, amount reimbursable, amountreimbursed, and balance reimbursable.

Project accounts would be audited annually by an independent auditor accept-able to IDA, and in accordance with sound auditing principles consistentlyapplied. For this purpose the Auditor General would be an acceptable auditor.An assurance was obtained from Government that within nine months from the endof the financial year, audited financial statements would be furnished to IDA.

VI. PROJECT IMPLEMENTATION AND EXECUTING AGENCIES

Project Organization

6.01 The project would be under the responsibility of the Ministry ofLocal Government, Rural Development and Cooperatives (MLGRD&C) and would beimplemented by the Ministry's Integrated Rural Development Program (IRDP) andthe Department of Public Health Engineering (DPHE). Overall management of theproject would be vested in the Credit, Cooperatives and Marketing Division ofthe IRDP. The DPHE sub-project management unit would be in the office of theSuperintending Engineer, Planning. The Director of the Credit, Cooperativesand Marketing Division of IRDP would serve as project manager, and a full-timeDeputy Director for HTWs would be assigned to assist in carrying out day-to--ay project administration. The DPHE Superintending Engineer, Planning, woulde the manager of the sub-project management unit in DPHE, and a full-timeExecutive Engineer would be assigned to assist him. Incremental full-timestaff requirements of DPHE and IRDP are indicated in Annex 4, Table 4.

6.02 Coordination and consistency of project pricing, procurement,research, and programming of hand tubewell production and distributionbetween the project and the SSIP project of BADC would be maintained througha National HTW Coordinating Committee to be set up under the project. TheDeputy Director for HTW would serve as Secretary to the Committee which wouldmeet at least semi-annually to plan and coordinate action timetables and poli-cies and procedures to be followed in implementing hand tubewell projects.A condition of effectiveness of the Credit would be that the the HTW Coordi-nating Committee has been established.

- 27 -

Procurement and Distribution of Raw Materials

6.03 DPHE would be responsible for procurement of pig iron, coke, andpipes under ICB procedures. The project would be the agency's first partici-pation in an IDA-financed project. However, DPHE has experience in interna-tional procurement as a result of its activities in village water supply.Draft tender documents have been prepared (Project File), and no delays inprocurement are anticipated.

6.04 Tendering for raw materials (pig iron, coke and pipes) would be doneon an annual basis to meet the production requirements for the following year.Imported raw materials would be received by DPHE at the ports of Chittagongand Chalna and would be stored temporarily in the DPHE Central Stores atChittagong and Khulna (near Chalna). Raw materials would be reallocated betweenthese two stores and the Central Store at Dacca according to quarterly produc-tion plans arising out of contracts with domestic foundries and machine shopsfor the fabrication of pumpheads and strainers by firms located primarily inthe vicinities of Chittagong, Khulna and Dacca. DPHE would contract with localtransportation firms under LCB procedures satisfactory to IDA (draft tenderdocuments in Project File) for the transport of raw materials between the threeCentral Stores. Trans-shipment between the port of Chalna and the store atKhulna would be by barge. Other inland shipments would be by rail and truck.Small inland shipments would be handled by DPHE using vehicles provided underthe project. Sufficient capacity exists in the local transport industry toaccomodate the needs of the project, and performance of local firms under theUNICEF MOSTI project was satisfactory. With the additional back-up equipmentprovided by the project, no difficulties in local shipment of raw materialsare anticipated.

6.05 A full-time Assistant Engineer for Tendering and Procurement inthe DPHE sub-project management unit, preferably with first-hand experienceof procedures under the UNICEF MOSTI project, would be appointed under theproject and would be responsible for international tendering and procurementof raw materials. A full-time Assistant Engineer for Distribution would beresponsible for local shipment and storage of raw materials and finishedpumpsets between DPHE stores. Both Assistant Engineers would report to theExecutive Engineer for HTW. A condition of effectiveness would be that theExecutive Engineer and the Assistant Engineers for Tendering and Procurementand for Distribution have been appointed.

Fabrication of Pumpheads and Strainers

6.06 Contracts for fabrication of pumpheads and strainers would be letby DPHE under LCB procedures satisfactory to IDA. The pumphead design wouldbe the 'improved' Bangladesh No. 6 hand pump, the same pump that is used forvillage drinking water supply and was used during the UNICEF MOSTI project.The strainer would be made from GI pipe which had been slotted or drilled inlocal machine shops. Farmers who purchased pumpsets would wind the strainerpipe with locally-bought coir rope. Fabrication, machining, and assembly ofpumpheads would be contracted with domestic foundries having machine shop andassembly capabilities satisfactory to DPHE quality control staff and theirconsultants (para 6.08).

- 28 -

6.07 Contracts for pumphead fabrication would be on a 'net cost' basis.Pig iron and coke would be supplied to foundries in fixed proportions accor-ding to the number of pumpheads contracted (80 pounds of pig iron and 20pounds of coke per pumphead). The first installment of raw materials to acontracting foundry would be secured by a bank guarantee for the value of thematerials. Following installments of raw materials would be issued only onreceipt by DPHE of finished pumpheads from the previous installment meetingestablished quality control standards and a continuing bank guarantee for thevalue of raw materials supplied. Foundries would tender in terms of the costof fabricating pumpheads, excluding the cost of raw materials supplied byDPHE. Foundries would be responsible for collecting the raw materials fromthe DPHE Central Stores and for delivering finished pumpheads to the CentralStores and would tender accordingly. Eligibility for tendering would belimited to those foundries on the DPHE list of qualified foundries, developedand continuously up-dated by DPHE with the assistance of UNICEF. In 1980,the list included 32 qualified foundries. Qualification is based upon physi-cal, financial, and managerial assets and an established record of supplyinggood quality foundry products. An assurance was obtained that the standardtender document for the fabrication of pumpheads and holing of pipes forstrainers would be acceptable to IDA. Contracts for the holing of pipesfor strainers would be let by DPHE under LCB procedures satisfactory to IDA.Contracted machine shops would be required to collect GI pipes from the DPHECentral Stores and to deliver holed pipes to those same stores. Pipes wouldbe supplied initially against a bank guarantee for the value of the pipes.Second and ensuing installments of pipes would be supplied to machine shopsonly upon receipt of holed pipes meeting DPHE quality control standards anda continuing bank guarantee for the value of pipes supplied. Machine shopswould tender on a 'net cost' basis, excluding the cost of pipes supplied byDPHE. Tenders would include the cost of transporting pipes from CentralStores to the machine shops and returning holed pipes to the Stores. Contract-ing for the holing of pipes would be the responsibility of the DPHE AssistantEngineer for Tendering and Procurement.

Quality Control of Pumphead and Strainer Fabrication

6.08 Quality control of foundry operations and of machine shop operationswould be the responsibility of the DPHE. The project would provide a full-time Assistant Engineer for Quality Control, who would be assisted by aninternationally-recruited quality control consultant provided under theproject (30 man-months). Standards and procedures for quality control infoundry operations were established under the UNICEF MOSTI project (ProjectFile). DPHE has experience in foundry quality control as a result of theprevious MOSTI project and the continuing activities in village water supply.Quality control staff would monitor production in participating foundries andmachine shops and would test samples both at the production site and upondelivery of finished products at DPHE Central Stores.

Credit Program

6.09 Pumpsets and tool kits would be sold by TCCAs on both cash andcredit terms (para 4.19). For pumpsets bought on credit, a down payment of10% of the purchase price would be required. The outstanding balance would be

- 29 -

financed over a three year period, with equal annual payments of principaland interest beginning on July 31 of the following year for loans made in thefirst half of the year and on December 31 of the following year for loans madein the second half of the year. The due dates would approximate the end ofagricultural production periods, at which times farmers could most readilyrepay the medium-term loan installment. Interest on the loans would be at thestandard rate for agricultural loans, but not less than the current 13% perannum.

6.10 Major toolkits would be sold either for cash or on the same creditterms and repayment schedule as pumpsets. Minor toolkits would be sold onsimilar arrangements only if purchased together with a pumpset on medium-term credit arrangements. It is estimated that approximately 15 percent ofpurchases of pumpsets and minor and major toolkits would be for cash; theremainder would be obtained on credit.

6.11 Government would arrange that sufficient medium term and short termcredit be made available to meet the incremental credit requirements of theproject on terms and conditions satisfactory to IDA (paras 4.19 and 4.20 andAnnex 7, Table 1). The lending rate (currently 13 percent per annum) andinterest margins (Annex 7, Table 3) would accord with prevailing Governmentcredit policy. Lending procedures would remain unchanged from the UNICEFMOSTI project (Project File). The IRDP Director for Credit, Cooperatives andMarketing would be responsible for ensuring that credit facilities reflectedplanned production and distribution of pumpsets under the project. Incrementalshort term credit requirements would be provided through existing productioncredit programs available at the TCCA.

Training

6.12 Training of TCCA staff and farmers would be the responsibility ofIRDP while training of village mechanics would be the responsibility of DPHE.Village mechanics would be trained in major hand tubewell repairs and in sink-ing and lifting pumps, and farmers would be trained in minor maintenanceprocedures. Training programs of farmers, village mechanics and TCCA staffwould be arranged and coordinated through the Assistant Director for Trainingand Credit in the M1OSTI Project Management Unit of IRDP (para 4.14). Anassurance was obtained that a plan to execute the training program be agreedupon with IDA no later than January 1, 1982.

Research and Testing

6.13 The research and testing program would be carried out by the Depart-ment of Mechanical Engineering of the Bangladesh University of Engineeringand Technology (BUET), under a contract funded by the project and supervisedby a Research and Testing Committee to be established under the Project (para6.16). Two staff members of the Mechanical Engineering Faculty would overseethe research and testing and would provide guidance to two graduate engineers,hired under the project, who would have primary responsibility for carryingout the research and testing program.

- 30 -

6e14 During the first year of the research and testing program, effortswould be concentrated on collecting promising alternative models of manualirrigation equipment from within and from outside Bangladesh and upon develop-ing benchmark measures for the No. 6 pump for comparison with potentialalternative designs. The possibility to coordinate with a recently initiatedworldwide research program by UNDP to find and develop improved models shouldbe explored (para 4.16). The project would provide for four internationaltrips by the research and testing staff to facilitate the search for alterna-tive prototype equipment. In addition, provision would be made for the pur-chase and air freight back to Bangladesh of promising prototypes.

6.15 The project would provide funds for hiring and equipping 5 fieldinterviewers to conduct user surveys under the direction of the research andtesting consultants. A benchmark survey of farmers' use of the No. 6 handpumpand the continuous monitoring of field-tested prototypes would be carried out.

6.16 A Research and Testing Committee composed of the IRDP Joint Directorof Irrigation, the Deputy Director of Irrigation, the Deputy Director forHTW, the DPHE Superintending Engineer for Planning, and the Executive Engineerfor HTW would supervise the research and testing component. The Committeewould oversee the research activities and would ensure that the agreed plan ofwork be carried out diligently and within the agreed time frame. An assurancewas obtained that the Committee would be established and for the third yearreview would submit to IDA a report evaluating the results of such testing ofHTW models and a recommendation on whether any hand tubewell designs should beadopted for future HTW projects. Upon receipt of the Committee's recommenda-tion, IDA and GOB would mount a joint Review Mission in Project Year 3 toappraise the feasibility of implementing the improved design in any follow-upproject (para 6.18).

Monitoring and Review

6.17 Maintenance of the monitoring and reporting system for the projectwould be the responsibility of the IRDP Deputy Director for HTW. An assis-tant to the Deputy Director for monitoring and reporting would be delegatedthe routine monitoring functions. The MIS consultant hired under the projectwould work with the Deputy Director for HTW and would report to the DirectorGeneral of IRDP.

6.18 The third year review would consist of twelve man-weeks of fieldwork. The review would appraise the remaining demand for hand tubewells andthe technical and economic viability of the improved design pumpset which theResearch and Testing Committee recommends. If the recommended pumpset werefound to be acceptable to farmers and foundries, the mission would prepare afollow-up project based on the new recommendation. IDA would allocate eightman-weeks of project supervision for the purpose, in addition to normal annualsupervision manpower needs, and GOB would make available 16 man-weeks of_LGRD&C staff time to serve as a counterpart team. The review would bescheduled to follow immediately the laboratory and field testing phase of theresearch and testing component, which is expected to be completed at the endof project year two, and would be contingent upon receipt by IDA of theResearch and Testing Committee report recommending adoption of the improveddesign.

- 31 -

Project Accounts

6.19 Consolidated project accounts would be maintained by the HTW ProjectMianagement Unit in IRDP through the Assistant Director for Distribution andAccounts. Individual accounts kept by DPHE would be provided to IRDP forconsolidation. Individual TCCAs would maintain records of pumpset orders,cash and credit sales, and inventories of HTW sets and spare parts. AccountAssistants at the DPHE Stores at Chittagong, Khulna, Dacca, and Natore wouldmaintain detailed records of inventories and would provide monthly inventorystatements on raw materials and pumpsets to the DPHE sub-project managementunit. The Accounts Officer in the Office of the Executive Engineer wouldsupply monthly consolidated inventory statements to the DPHE Assistant Engineerfor Distribution and to the IRDP Assistant Director for Distribution andAccounts within the HTW Project Management Unit. Records of project receiptsand expenditures by DPHE would be kept by the Executive Engineer for HTW,assisted by the Accounts Officer, and would be forwarded on a quarterly basisto the IRDP Assistant Director for Distribution and Accounts who would beresponsible for maintaining records of project receipts and expenditures byIRDP and for producing quarterly consolidated accounts of overall projectreceipts and expenditures. The IRDP Deputy Director for HTW, with theassistance of the Assistant Director for Distribution and Accounts, wouldbe responsible for maintaining records and accounts detailed in para 5.07,sufficient to meet the audit requirements of GOB and IDA.

VII. PRODUCTION, MARKETING AND COST RECOVERY

Cropping Patterns

7.01 The effects of project implementation on cropping patterns and cropproduction would depend on the siting of the HTW in relation to land elevationand water table depth in the dry season. These features would be more signi-ficant to HTW usage than would gross regional differences in climate. Thecharacteristics of four major land divisions (Models I-IV) are given in Annex2, Table 6.

7.02 The provision of irrigation by hand tubewells would add a total ofover 62,000 acres per year to the cropped area of HTW farmers. While theactual area irrigated by a HTW at any one time during the dry season would bebetween 0.3 and 0.5 ac, depending upon elevation and crop, the peak waterrequirements of different crops grown throughout the year would not coincide(Annex 2, Chart 2 and Tables 3 and 4). Thus, the total area of influence ofthe HTW throughout the year would be at least one acre. Farmers with smallplots would share the HTW with adjacent small farmers or rent adjacent land.On higher land (Models (I and II) boro would rarely be grown because of exces-sive pumping demands (at least 1,660 man hours per acre per season would berequired, Annex 2, Table 7). Thus, in these areas the intensity of paddy pro-duction would remain constant at about 90% of the cultivated area. Increasedcropping intensity on higher land would result from the greater production ofwheat (10,500 acres), together with potatoes, chillies, oilseeds and two cropsof vegetables in the dry season.

- 32 -

7.03 On lower lands (Model III) irrigation would enable the dry seasoncultivation of boro to be increased by about 6,000 acres per year. In addi-tion, wheat (6,000 acres), oil seeds (4,000 acres) and chillies (2,000 acreswould be irrigated by HTWs in these areas. On flood plains (Model IV), whereonly a single monsoon crop is currently feasible, about 0.3 ac of boro wouldbe grown with each HTW. With the addition of a small area of oil seeds andvegetables, the effective farming area of a HTW farmer in the flood plainswould be increased by about 0.5 ac per year.

7.04 The availability of an assured water supply under the direct controlof the small farmer would be expected to change attitudes to risk. Farmerswith hand tubewell irrigation would adopt HYVs, fertilizer and pesticide usagemore readily than farmers reliant on uncertain rainfall. This would beparticularly important in affecting change from broadcast to transplantedpaddy. With assured water for nursery irrigation, crops would be sown andtransplanted earlier, thereby enabling the greater yield potential of HYVs tobe exploited. The ease with which the HTW can be moved between fields wouldallow farmers to provide supplementary irrigation to paddy during shortdrought periods in the monsoon season and to T. aman at the end of the rainswhen the water table is still high. Irrigation availability would thereforedecrease risk to the rainfed crops including jute.

Yields and Production

7.05 With the increased use of HYVs, fertilizer and pesticides, theincreased emphasis on transplanted rather than broadcast paddy, and particu-larly the use of irrigation to overcome drought periods, yields per acre withthe project, would increase substantially (Annex 2, Table 10). 1/ Yields ofboro, currently grown only in low lying ground with traditional irrigationwhere possible, would more than double (from 22 md/ac to 46 md/ac) with anassured water supply. Similarly, the change to transplanted HYV Aus withfertilizer and plant protection would increase Aus yields from 16 to 34 md/ac.Wheat yields are currently very low as attempts are made to grow this cropwith uncertain traditional irrigation. HTW usage would increase wheat yieldfrom 18 to 32 md/ac. The production of potatoes and lentils grown with irri-gation during the dry season would be additional to normal production as theseare rarely attempted with traditional irrigation. Jute yields would increaseby over 70 percent where irrigation would allow reliable early sowing and thegreater use of crop inputs. In addition, irrigation during the dry seasonwould enable farmers to improve their incomes and the nutritional status oftheir diets by growing two crops of vegetables, by improving the quality oftheir pulses (from local khesari to lentils) and by growing a small area ofoilseeds and chillies.

1/ Yields are derived on the basis of the following sources: (a) "Feasi-bility Report on Comilla and Noakhali Project - Phase I (Dakatia Unit)(Drainage and Flood Control II)"; (b) "Evaluation of N.W. TubewellProject", by Bangladesh Institute of Development Studies; (c) interviewswith government officials and farmers.

- 33 -

Crop Input Requirements

7.06 Annual incremental input requirements at full development are givenin Annex 2, Table 13. A total annual requirement of 8,000 tons of fertilizerwould be needed (54% urea, 29% triple superphosphate and 17% muriate of potash).This would be in addition to animal manure traditionally used by farmers. Theannual incremental requirement of improved seed to plant 135,000 acres affec-ted by HTWs would be about 2,325 tons. However, all crops are pure breedinglines and farmers would save their own seed for some years. At a replacementrate of 20 percent about 465 tons of seed per year would be required, thegreatest need being for HYV T. Aman (197 tons) and wheat (139 tons).

7.07 Procurement of fertilizer and improved seed is organized by BADC whodistribute fertilizer through registered dealers who sell directly to farmersat Government fixed prices. Fertilizer is also made available to farmers byBADC through traditional cooperatives and the TCCA/KSS system. BADC meetsfarmers' seed requirements by organizing seed multiplication farms, contractgrowers schemes and, as in the case of potatoes, by direct importation. Salesof seed are made, under the supervision of the thana seed inspector, eitherdirect to farmers or through agricultural cooperatives. Availability offertilizer and seeds to meet project requirements is adequate.

7.08 The incremental requirements for animal power would be substantial(1.7 M team days based on requirements outlined in Annex 3) but much of thisrequirement would occur on irrigated land in the dry season when, without theproject, the use of work animals is relatively low. No shortage of animalpower is envisaged. The annual incremental requirement of pesticide for insectcontrol on paddy, wheat, jute and vegetables would be about 13 tons. Pesticideprocurement was formerly the responsibility of BADC but can now be imported byprivate dealers. Spraying equipment is supplied through the Plant ProtectionInspector of the district extension office and the Plant Protection Assistantat the thana level. Some shortages of pesticide have occurred at village levelbut with privatization the supply position of all farm inputs is likely toimprove.

Irrigation Requirements and Pumping

7.09 Crop water requirements vary with geographic location, largelydepending upon the amount and distribution of rainfall, with the specificcrops involved and their stage of growth, and with the physical characteris-tics of the soil. The calculation of bi-monthly irrigation requirements forthe ten crops most likely to be grown with HTWs is summarized in Annex 2,Table 4. In calculating irrigation requirements no distribution losses wereincluded as the HTW is almost invariably sunk directly into the field to beirrigated. The substantial effort involved in pumping hand tubewells (Annex2, Table 12) usually results in highly efficient usage of water. The HTWfarmer does not keep paddy flooded but pumps almost continuously for landpreparation and transplanting purposes, then floods the field to shallow depthintermittently throughout the cropping period. Boro is the most water demand-ing crop, requiring at least 28 inches per season (equivalent to about 45inches with distribution and some deep percolation losses) whilst wheatrequires about 11.5 inches and the other rabi crops, potatoes, vegetables (2

- 34 -

crops per dry season) pulses and oilseeds about 11.5, 13.4, 7.3 and 8.7 inchesrespectively. The rainfed crops, T. Aus, T. Aman and Jute require supplemen-tary irrigation in the early and late monsoon periods.

7.10 Labor requirements for pumping depend on the crop irrigation needs,the area of land to be irrigated and the water table depth, which determinespump discharge (Annex 2, Table 5 and Working Paper 2). Using average watertable depletion curves for the dry season, the pumping hours per acre foreach crop in each of the model areas is presented in Annex 2, Table 7 andsummarized under crop inputs (Annex 2, Table 10). By combining these valuesfor the farm models the pumping requirements per month for each tubewell wascalculated (Annex 2, Table 11). Total pumping requirements per HTW per yearwould vary from 479 hours on low lying land (Model IV) to 837 hours on highland (Model I). Peak pumping would occur during the 3 months, February, Marchand April. The maximum pumping requirement of 213 hours per month occurs inMarch for a Model I tubewell irrigating about 0.5 acres. A survey 1/ hasrevealed that most members of a family take turns at pumping and that the HTWis pumped both day and night at peak demand periods (Annex 2, Table 9). Thusan average farm family of 7 persons could readily provide 120 hours per monthof pumping (1 1/2 adult equivalents at 5 hours per day for 16 days per month)leaving at least 208 hours per month (1 adult equivalent for 26 days at 8hours per day) for cultivation. Any requirement above these figures woulddemand the use of hired labor. All cultivation labor for HTW irrigated cropscan be provided from the family; only about 8 percent of the total laborrequired for pumping is hired. This is confirmed by the 1980 IBA survey whichstates that virtually all labor is provided from the smallholder's family butthat larger land owners employ labor for pumping.

Energy Requirements for Pumping

7.11 The No. 6 handpump is not an efficient pump for irrigation andrequires a substantial amount of energy to draw water. Nevertheless manythousands of farm families use the pump for irrigation in Bangladesh. Annex2, Table 12 compares the average incremental energy requirement for pumpingand cultivation with the average incremental grain production from using theHTW. The calories used equal about 16 percent of calories produced in grain.This takes no account of calorie production in vegetables and minor cropswhich would also increase vitamin intake.

Marketing

7.12 The marketing system in Bangladesh is largely traditional. Mostgrowers dispose of portions of their crop before or immediately upon harvestfor three reasons: the immediate need for cash; crop loan obligations; andtenancy crop division arrangements. Such farmers often have to buy grainlater at higher prices for family consumption. However, only 2-3 million tonsof foodgrain, about 20-25% of national production, actually enter commercialmarkets, and private traders handle about 80% of such trade. Approximatelyanother 25% are exchanged through barter trade. Commercial traders buy grain

1/ IBA Survey, University of Dacca, 1980.

- 35 -

principally at primary daily and local weekly markets. Farmer cooperativeshave been officially encouraged to market paddy and engage in rice milling,but so far such efforts have not been successful. Government procurement inthe past has remained small, averaging about 3 percent of national production,but recent moves to expand open market sales to stabilize food prices, toincrease procurement centers and storage capacity, and to contract privatedealers to purchase food grain have tended to reduce market price fluctuations.Most villages are food deficit areas and per capita consumption remains atabout 15.5 oz of grain per day. To increase this for the 945,000 persons whowould be directly affected by the HTW project to the FAO/WHO recommendedlevel of about 19.2 oz of foodgrain per head per day would require about36,250 tons of grain per annum. This is 66 percent of the incremental grainproduction from the project. The nature of the HTW project would tend todisperse hand tubewells widely. Thus no localized concentration of increasedproduction of vegetables, potatoes, chillies and pulses would be likely andno resulting marketing problems are foreseen.

Farm Incomes and Cash Flow

7.13 The impact of the project on farm income was analyzed for fourdifferent farm models based on different farm elevation and flood levels(Annex 3, Tables 1-4). Because of scarcity of detailed data on off-farm andother agricultural income and the fact that most of the incremental employmentdue to the project would occur during the dry season, when unemployment isrelatively high, only crop production activities have been taken into accountin estimating farm income. Specific cropping patterns have been incorporatedfor each model, while input requirements and yields are based on nationalaverages. As Table 7.1 shows, the project would have a pronounced impact onnet farm incomes in all models. Incremental income would vary for each modelwithin a range of 95 to 135% of the without project income situation.

TABLE 7.1: Project Impact on Incomes

Net Present Value of Income /aModel Without Project With Project Increment

(Tk) (Tk) (%)

Model I 8,786 17,332 97Model II 9,148 20,283 122Model III 7,820 15,549 99Model IV 5,673 14,449 155

/a Over 10 years at 12%.

While the exact project impact on income distribution is unknown, it isanticipated that a large number of small farmers would purchase HTWs underthe credit arrangements provided by the project. In this light, Table 7.1suggests a substantial reduction in the absolute level of poverty.

- 36 -

Prices

7.14 Government provides guaranteed support prices for paddy and wheat.The latest procurement price for 1980 for paddy is Tk 115 per maund; wheatTk 110 per maund. Because of weaknesses in the official procurement machinery,paddy farmgate prices have demonstrated volatility and at times have dippedbelow procurement prices. Current procurement prices are considered reason-able and, if enforced effectively, provide adequate incentives to cultivators.These prices, however, must be reviewed continually to ensure adequate incen-tives in light of rising input prices and GOB's strategy to stimulate agricul-tural production. Prices for paddy and wheat used in the financial analysesare based on mission survey data. These prices conform with national averagesand official prices when adjusted for quality differentials and procurementimperfections. Prices for other crops such as jute, chillies, pulses, oil-seeds, potatoes, and other vegetables are based on government surveys ofmarket prices for these commodities. Farmgate prices used in the financialanalysis (Annex 5, Table 1) represent market prices adjusted for transportand handling costs.

7.15 Prices for fertilizer and pesticides used in the analysis are sub-sidized levels current at the time of appraisal (September 1980). Pricesfor other inputs such as animal and human labor are based on prevailingmarket prices in farming areas.

Cost Recovery

7.16 Government contribution to the project would consist of local costsof institutional investments and medium-term credit for the purchase of pump-sets and toolkits. Government would also ensure that the existing short-termcredit program would provide sufficient short-term credit for project farmersto purchase inputs. Recovery of project costs would be through payment byfarmers for the purchase of pumpsets and toolkits. These payments would con-sist of cash payments, and down payments and repayments on medium-term loans.The projected flow of funds to Government over the project implementationperiod is shown in Annex 4, Table 12.

7.17 The proposed pricing of HTWs under the project would cover fullcosts (net of taxes and duties) of raw materials, fabrication and transport,plus a 15% margin (para 4.23). Government's grant funding of the TCCA/KSSsystem would be reduced by this 15% margin which would accrue to the TCCA/KSS.The margin would, therefore, effectively constitute part of cost recovery, andwould be sufficient to cover full institutional project costs. Thus, oncerepayments for pumpsets and toolkits are complete, project costs (net of taxesand duties) would have been fully recovered.

- 37 -

VIII. BENEFITS, JUSTIFICATION AIS RISKS

Project Benefits

8.01 Production. At full development, in 1986, successful project imple-mentation would lead to incremental annual production of about 30,700 tons ofrice, 24,600 tons of wheat, and 6,750 tons of jute. On the basis of projectedworld market prices, the incremental production of these commodities representsa gross annual equivalent foreign exchange saving of US$24 M. 1/ Allowing forthe added imports of fertilizers and pesticides (US$3 M annually), which wouldbe necessary to obtain the projected yields, the project would represent a netannual foreign exchange savings of about US$21 M 1/ at full development.Accounting for the foreign exchange costs related to the production of theHTW and other project related imports, in terms of net present value at theestimated opportunity cost of capital (12%), total net foreign exchangesavings from the project would be about US$76 M 1/ over the project life. Inaddition to these benefits, increased vegetable, pulses, and oilseed produc-tion would result from the introduction of these crops on most farms purchasinga HTW and from improved yields on those farms already producing these crops.

8.02 Drinking Water. Most of the pumps (75%) produced under the projectwould be used primarily for irrigation. The remaining 25 percent are expectedto be purchased by relatively wealthier farmers for meeting their domesticwater supply needs. Due to the lack of easily accessible safe water sourcesin many parts of the project area, these incremental benefits are significant.It is estimated that between 12 and 25 percent of the water production fromHTWs purchased for irrigation would be used for domestic needs. Those HTWspurchased exclusively for domestic needs are expected to be operated aboutone hour per day, while those purchased primarily for irrigation would be usedonly about 20 minutes per day for domestic purposes. On the basis of theseestimates, the project would increase the supply of safe drinking water by 260M gallons annually.

8.03 Employment. Increases in employment opportunities due to the proj-ect would be substantial. Most of this increase would result from the laborinput requirements to operate the HTW. Additional labor input in cultiva-tion activities would also be required in view of the altered cropping patterns,more intensive use of inputs, and higher yields (Annex 2, Tables 10-11). Inthe first year incremental employment due to the project would be about 6million mandays, not including incremental employment of 120,000 mandays inthe fabrication of HTWs. By full development, incremental employment wouldhave reached 26.7 M mandays annually. The majority of the increased employ-ment would be filled by otherwise unemployed farm family members; only about8% would be labor hired to operate the HTW. This implies an increase inannual employment opportunity of about 200 man-days per farm family. Sincethe HTW is operated during the dry season when agricultural employment is low,(Annex 2, Table 11), the HTW has the added benefit of offering productiveemployment at the time of year when the labor surplus is relatively high.

1/ In 1980 dollars.

- 38 -

Project Beneficiaries

8.04 Some 135,000 farmers and their families would benefit from increasedagricultural income from irrigation and from safe drinking water, whileanother 45,000 farm families would use the HTW principally for providing safedrinking water. Experience from the completed UNICEF MOSTI project suggeststhat tubewells used for domestic purposes only will be purchased primarily, ifnot exclusively, by the wealthier farmers. However, several characteristicsof the project and the nature of HTW irrigation are likely to lead to substan-tial participation of small farmers in HTW irrigation:

(a) The HTW is capable of irrigating only a small area, sothat it becomes relatively less attractive to larger far-mers who would benefit more from DTWs, STWs, and LLPs;

(b) Medium-term credit at the point of HTW sale (TCCA) wouldbe made available under the project;

(c) Short-term credit with which to finance the increased inputsrelated to HTW use would also be made available under theproject; and

(d) Small farmers have a greater surplus of family labor, whichmakes the highly labor intensive HTW more attractive to themthan to larger farmers with little surplus family labor.

The farm budgets for the four different models considered (Annex 3) indicatethat the HTW can significantly improve the income of small farmers. Much ofthis increased income derives from productively employing farm family members.

Environmental Effects

8.05 The project would have no adverse effects on the environment. Watertable draw-down due to HTW irrigation is negligible. Simulation analysis ofwater table draw-down and replenishment rates suggest that the project could berepeated many times without significantly affecting the water table depth andstability. General hygiene and related health conditions would improve due tothe increased availability of clean water.

Economic Analysis and Sensitivity Tests

8.06 The economic analysis has been carried out for the project as awhole. Summary economic costs and benefits are presented in Annex 5 , Table 3.The following assumptions have been used in the analysis:

(a) benefits and costs are expressed in 1980 constant prices,net of identifiable local taxes and duties;

(b) the incremental project output of paddy, wheat, jute, oil-seeds and project inputs of urea, TSP, and MP are valued atthe average forecast world prices for 1982 to 1990 Annex 5,Table 2;

- 39 -

(c) the exchange rate is taken at a constant Tk 16.0 = US$1.0;

(d) incremental farm labor is valued at a seasonally-adjustedwage rate of 68% of the financial wage rate of Tk 10/manday,to reflect the prevailing degrees of unemployment and under-employment. A manday of cultural labor is equal to 8 hours;pumping labor, 5 hours;

(e) the economic prices for traded goods (pig iron, coke, G.I.pipes, paddy, wheat, jute, oil seeds, urea, MP, TSP, andpesticide) are based on their border prices at the officialexchange rate. Domestic costs, i.e. local fabrication,transport, marketing, labor, and other minor non-tradedcosts and benefits are adjusted by the standard conversionfactor, 0.75;

(f) drinking water benefits from HTWs used primarily for irriga-tion are taken to equal the operating and related maintenancecosts; those from drinking water wells are taken to equal theannualized (at 12%) capital,operating, and maintenance costsfor each year. Since this procedure ignores the consumersurplus benefit from drinking water, it results in a conser-vative estimates of these benefits;

(g) full costs of the institutional support components have beenincluded; and

(h) the period of analysis is 12 years.

Using the assumptions given above, the best estimate for the ERR is 44%, 1/and for the NPV (at the opportunity cost of capital of 12%) Tk 658 M. TheERR when costs and benefits of drinking water MOSTI are excluded is 47%.Sensitivity tests indicate that the project is mildly sensitive with respectto most variables. It is somewhat more sensitive with respect to yield andprice changes but for all expected extreme changes in the variables, theproject maintains a rate of return well above the estimated opportunity costof capital of 12%.

1/ Since the analysis involves semi-annual crops, the rate of return wouldbe overestimated if unadjusted annual net cash flows were used in thecalculation. To adjust for this, a working capital cost stream has beenintroduced along the lines presented in "Methodology of Farm InvestmentAnalysis", by Walter Schaefer-Kehnert, CN-67.

- 40 -

Table 7.1: SENSITIVITY ANALYSIS

SwitchingValues (%) a

1. HTW costs +3752. Farm non-labor costs +1003. Farm labor costs +1004. All farm costs (except HTW) +505. All costs +456. Yields or output prices -327. All benefits -31

/a Percentage changes in variables which would make thenet present value of the project, evaluated at theopportunity cost of capital of 12%, equal to zero.

Project Risks

8.07 The project faces no major risks. Annex 5, Chart 1 shows the switch-ing value locus for changes in costs and benefits. For the project to becomeuneconomic, benefits would have to fall by 31% or costs increase by 45%; bothevents are highly unlikely. The techniques for HTW irrigation were provenunder the completed UNICEF MOSTI project and therefore present no risks to theproject. There is,however, a risk that the project may overextend the imple-mentation capacity of the agencies concerned. Should this occur, targets wouldnot be met and both benefits and costs would be less than projected. Theproject would remain viable under such circumstances, particularly in view ofthe insignificance of institutional and overhead costs when compared to thevariable costs and benefits of HTW fabrication and on-farm use. Finally,there is the risk that the establishment of DTW and STW in the project areamay dry up HTW wells. However, because of its mobility and farm fragmentationthe HTW could be moved to another plot. If drying out were widespread, the HTWcould be sold in the market to other farmers where the benefits would continueto be realized and the farmer would recoup most, if not all, of his originalinvestment.

IX. RECOMMENDATIONS AND ASSURANCES

9.01 The Government of Bangladesh gave the following assurances duringnegotiations:

(a) that an office of quality control would be establishedunder DPHE by January 1, 1982 (para 4.12);

(b) that by November 30, 1981, Government will cause DPHE tohave entered into a contract, satisfactory to IDA, with BUETto carry out the Research and Testing Program (para 4.16);

- 41 -

(c) that by January 1, 1982 a management information systemwill have been established within IRDP to provide con-tinuous monitoring of project progress and feedback ofinformation (para 4.17);

(d) that Government would employ consultants for technicalassistance whose experience and terms and conditions ofservice were acceptable to IDA (para 4.18);

(e) that Government would ensure the availability of mediumterm credit sufficient to meet incremental medium termcredit requirements of the project on terms and conditionssatisfactory to IDA and would enter into an onlendingagreement with financing banks, satisfactory to IDA(para 4.19);

(f) that medium-term loans for purchase of HTWs and tool kitswould be repayable in annual installments over a three-yearperiod at the prevailing GOB interest rate for medium-termagricultural loans plus a 1% TCCA margin, in total not lessthan 13% per year (para 4.19);

(g) that Government would provide, through the existing productioncredit financing system, sufficient short-term credit for thefinancing of incremental on-farm working capital requirementsof the project (para 4.20);

(h) that foundries would be given a buy back option on up to20% of the pumpheads they produce and that a provision forthis option would be included in each contract (para 4.22);

(i) that a pricing formula for HTW sales to farmers based onfull cost net of taxes and duties, and including a 15% marginnet of costs of transport from DPHE to TCCA/KSS, would beadopted, and that the prices would be reviewed and if necessaryadjusted annually to account for changes in costs, and that theexisting practice of charging higher prices for cash than forcredit sales be abolished (para 4.23);

(j) that pumpsets sold to foundries on the buy-back option wouldbe sold at ex-DPHE full cost pricing, net of taxes and duties(para 4.23);

(k) that IRDP and DPHE would maintain separate accounts of expen-ditures made under the project irrespective of whether thesewould be eligible for IDA disbursement (para 5.07);

(1) that within 9 months from the end of the financial yearaudited financial statements would be furnished to IDA(para 5.07);

- 42 -

(m) that the standard tender document for the fabricationof pumpheads and holing of pipes for strainers would beacceptable to IDA (para 6.07);

(n) that a plan to execute the training program be agreed uponwith IDA no later than January 1, 1982 (para 6.12); and

(o) that the Research and Testing Committee would be establishedand for the third year review would submit to IDA a reportevaluating the results of the testing of HTW models and arecommendation on whether any hand tubewell designs shouldbe adopted for future HTW projects (para 6.16).

9.02 Conditions of effectiveness would be that:

(a) the HTW Coordinating Committee has been established (para 6.02);

(b) two full-time Assistant Engineers for Tendering and Procure-ment and for Distribution, having experience satisfactory toIDA and the Executive Engineer for HTW had been appointedto the DPHE sub-project unit (para 6.05);

(c) GOB has entered into an agreement with at least one Partici-pating Credit Institution for onlending of funds to IRDP forMedium Term Credit; and

(d) the Project Proforma shall have been approved.

9.03 With the above assurances and conditions, the proposed project wouldbe suitable for an IDA credit of SDR 14.8 million (US$18.0 M).

- 43 -

BANGLADESH

HAND TUBEWELLS PROJECT ANNEX 1

The Foundry Process for Pumphead Production

1. The process for production of handpumps for drinking water or forirrigation is the same and consists of three phases: casting, machining, andassembly.

Casting

2. Ninety-five percent (by weight) of the pumphead is cast iron. Eightpieces of castings are involved for each head. Ground molding is resorted tofor castings. Hot metal from the cupola is tapped into ladles from which itis hand poured into models laid out in the specially-prepared dirt floors ofopen-air "casting bays". The molding sand is prepared from fine sand, cow dung,molasses, and graphite with traces of other materials added to give the desiredconsistency and strength. Patterns for the various parts to be cast are carvedfrom wood in some cases and in others are formed from aluminum or other metalsand alloys. The patterns are placed in casting boxes laid out in the floor,and the molding sand is filled in and pressed down around the form to createa mold. The casting box is then opened, the form removed, and graphite sprinkledor applied as a thin wetting on the mold surface for smooth flow of the hot metaland to control abrasion of the mold.

3. Pig iron, coke and scrap iron are "burned" together in the cupola attemperatures of approximately 1350-1400°C. For each 72-pound pumphead, eightypounds of pig iron and twenty pounds of coke are required. In addition a smallamount of scrap iron is used (UNICEF limits scrap to 5% of pig iron). The numberof molds which can be poured at one pouring depends upon the space available inthe casting bay, the number of molds ready and the capacity of the cupola.

4. When the castings have cooled, the boxes are opened and the castingsremoved for inspection, fettling, machining, and assembly. Runners and risersare recovered to the extent possible and recharged as scrap iron in the nextmelt. The shortage of scrap iron in Bangladesh and the low cost of unskilledlabor leads most foundries to pursue and achieve net wastage factors of lessthan 5 percent.

Machining

5. After removal from boxes, the castings are inspected, and those whichare acceptable are sent to the machine shop for surfacing of edges, boring ofbolt holes, and machining of the barrel of the pumphead to the tolerances required.

6. The other major component produced in the machine shop is the pistonrod made from locally-procured construction grade steel rounds which are producedin the rolling mill at Chittagong.

Assembly

7. Assembly of pumpheads takes place at the foundry. All parts except thenuts, bolts, steel pins, and leather valves are produced by the typical foundry/machine shop combination. Assembly, like the other phases of pumphead production,is labor intensive. The typical system involves full assembly at one table,rather than an assembly-line technique. Simple hand tools are used. Post-assemblytesting is done by visual and manual inspection. For those pumps being sold toDPHE/UNICEF, sample lots are inspected by agency quality control staff beforedelivery, and acceptance or rejection of the lot is determined by stringentstandards adopted by UNICEF.

- 44 -

ANNEX 2Chart 1

BANGLADESH

HAND TUBEWELLS PROJECT

Length of Rainy Season (Records 1934-69)

Average March April May June July August September October Noveberrainfall weeks weeks weeks weeks veeks weeks weeks weeks weeks IeeksIinches 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 al t

Rajshahi 57 - --- 27 23

Bogra 68 -- 27 25

Rangpur 81 -- ---- 26 25

Khulna 66 --…-- 29 26

Chittagong 112 29 27

Barisal 85 29 27

Mymensingh 88 31 27

Dacca 74 ------- 33 27

Comilla 99 … 33 28

1/ Probability of exceeding 0.5 inches in any one week (a - 302) (b - 502).

Souroes: IDA Report No. PS-13. Land and Water Resources Sector Study Vol. VII.

-45 - ANNEX 2

BANGLADESH

HAND TUBEWELLS PROJECT

Seasonal Cropping Patterns

NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT

RAINFALL PERIOD m i ** E i u m

CROPS

PADDY

BORO LOCAL

BOROHYV

B. AUS LOCAL .......

T. AUS HYV

B. AMAN LOCAL G

T. AMAN LOCAL l.**

T. AMAN HYV *.........

WHEAT .. a..

POTATOES - ....... 7CHILLIES _ ..

PULSES -

OILSEEDS . < -

JUTE

VEGETABLES

NurseryVVorld Bank-22224

Field

- 46 -ANNEX 2Table 1

BANGLADESH

HAND TUBEWELLS PROJECT

Present Adaptation of Cropping Pattern to Land and Soil

Soil State of Flood Present Cropping PatternLand Type Land Elevation Permeability During Monsoon Season Spring Summer & Fall Winter

1 High High Free Aus or Millet Fallow or Karif Rabi or FallowFallow vegetables Rabi or Fallow

2 High(flood plain) Low Free Aus or Jute Fallow Rabi

3 High(Barind Tract) Low Water poundable Fallow or Aus T. aman Fallowby bunding

4 Medium High Water poundable Aus or Jute T. aman Rabi or Fallowby bunding

5 Medium Low Very shallowly Aus or Jute T. aman Rabi or Fallowflooded

6 Medium Low Flood up to 3 ft. Aus or Jute T. aman Rabi or Fallow

7 Medium Low With flood hazard Aus Tall T. aman Fallow

8 Low High or Low Deep, but not Mixed Aus B. amanhazardous & B. aman (continue)

Jute Fallow

9 Low High or Low Deep and B. aman B. aman Fallowhazardous (continue)

Fallow Fallow Boro

10 Low, Char land High or Low Flood hazard Fallow Fallow FallowAus, or millet Fallow oror B. aman B. aman Rabi or Fallow

(continue)

11 Low, Char land High or Low Flood hazard Fallow Fallow FallowB. aman B. aman(cont.) Fallow

12 Low, Flood plain High or Low Flood hazard Aus or Juteridges outside or Millet Fallow Rabi or Fallowof embankment

13 Low, Flood plain High or Low Flood hazard Mixed Aus & B. aman Fallowdepressions outside B. aman (continue)of embankment Jute Fallow Fallow

Complied from data in (1) East Pakistan Soil Survey Reports, Bogra District and (2) Report on the Potential forRainfed HYV Rice Cultivation in Bangladesh, by H. Brammer, 1974.

- 47 -

ANNEX 2Table 2

BANGLADESH

HAND TUBEWELLS PROJECT

Bi-Monthly Irrigation Requirements for Paddy Nurseries (in inches)

Boro T-Aus T-Aman

Dec Jan Jan Total March Apr June July Totalb a b a b a a b a

Av. Evapotranspiration Index 1.1 1.0 1.1 2.1 2.2 2.6 2.1 2.2 2.1

Crop Factor 1.0 1.25 1.25 1.0 1.25 1.25 1.0 1.25 1.25

Consumptive Use 1.1 1.25 1.38 2.1 2.75 3.25 2.1 2.75 2.63

Land Preparation Req, 1/ 3.0 3.0 3.0 3.0 1.0 1.0 (land already wet

Deep Percolation Loss 2/ 1.0 1.0 1.0 from May rain)

Effective Precipitation 0.0 0.13 0.13 0.9 0.9 2.34 5.56 5.50 5.27

Net Field Requirements 4.0 4.02 2.25 10.14 4.20 4.85 1.91 10.96 - - - No irr. needed

Gross Field Requirements - 4.6 4.5 2.5 11.26 4.67 5.39 2.12 12.18 - - - " "

1/ Includes a substantial deep percolation loss because seedlings are shallow rooted

2/ Deep percolation loss is defined as the amount of water that moves from land surface through thesoil to a depth beyond the root zone of crops.

3/ Assuming a water distribution efficiency of 90 percent.

BANGLADESH

HAND TUBEWELS PROJECT

Bi-Monthly Average Field Irrigation Requirements

October November December January February March April ma June July A~uaut September Tntal

aa b b 7a b a b a b a b a b a b a b a b a b a

1/Av. Evapotranspiration Index 1.8 1.7 1.4 1.2 0.9 1.1 1.0 1.1 1.3 1.4 2.1 2.2 2.6 2.8 2.8 2.7 2.1 2.0 2.1 2.2 2.1 2.1 1.9 1.8 44.

P~oro: Crop Factor 1.25 1.25 1.30 1.35 1.40 1.45 1.50 1.30 1.30

Consumptive Use + 1.38 1.63 1.82 2.84 3.08 3.77 4.2 3.64

Land Preparation + 3.00 3.00

Soil Moisture Depletion-- 2.00 2.00

TrAus: Crop Factor 1.20 1.25 1.25 1.30 1.40 1.45 1.50 1.35

Consumptive Use 3.12 3.5 3.5 3.51 2.54 2.9 3.15 2.97

Land Preparation + 3.00 3.00

Soil Moisture Depletion --2.0 -2.0

T-Amnan:Crop Factor 1.50 1.45 1I.45 1.20 1.10 1.10 1.25 1.25 1.30 1.30 1.40 1.45

Consumptive Use + 2.7 2.47 2.03 1.44 0.99 2.2 2.63 2.75 2.73 2.73 2.66 2.61

Land Preparation + 3.00 3.00

Soil Moisture Depletion - -2.0 - 2.0

Deep Percolation Loss + 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0. 1.0 1.0

Effective Precipitation - 2.59 2.0 0.5 0.44 0.09 0.0 0.23 0.2 0.44 0.40 0.9 0.9 2.34 2.34 3.S 4.07 5.56 5.50 5.27 5.0 5.4 5.46 3.96 3. 50 60.59

Met Field RlequirementsBorn

5.18 5.19 2.42 2.98 3.18 2.43 2.86 - - 24.24

T-Aus 4.78 5.16 1.0 0.44 - - - - 11.38

T-Aman 1.11 1.47 2.53 - -0.70 1.36 - - - 0-13 1.28

Gross Field Requirenents (assum-

ing 107. loss for rice crops). 57 .72

Bn~ro 5.6 57 .9 3.31 3.53 2.70 3.171 - 26.92,

T-Aus 5.31 5.73 1.11 0.49 - - - - 12.64

T-Aman 1.23 1.63 2.81 - -0.78 1.51 0.12 8.08

BANGLADESH

HAND TUBEWELLS PROJECT

Bl-Monthly Average Field Irrigation Requirements (Continued)

October November December January February March Apr11 May June July Au gust September Totala b a b a b a b a b a b a b a b a b a b a b

Av. Evapotranapiration Index- 1.8 1.7 1.4 1.2 0.9 1.1 1.0 1.1 1.3 1.4 2.1 2.2 2.6 2.8 2,8 2.7 2.1 2.0 2.1 2.2 2.1 2.1 1.9 1.8 44.4

Wheat: Crop Factor 0.5 0.5 0.55 0.7 0.85 1.0 1.20 1.15 1.0consumptive Use 2/ 0.6 0.45 0.61 0.7 0.94 1.3 1.68 2.42 2.2Land Prep. +/ NMD 3.0 -1,0 -2.0

Pulses/Oilseeds: Crop Factor 0.5 0.55 0.75 1.05 1.10 1.10 1.10 0.95 0.5 0.55 0.75 1.05 1.1 1.10 1.10 0.95Consumptive Use 0.9 0.94 1.05 1.26 0.99 1.21 1.10 1.05 0.65 0.77 1.58 2.31 2.86 3.08 3.08 2.57Land Prep. + /SMD - Wet soil _ 1.0 - 2.0

eeables: Crop Factor 0.5 0.55 0.75 1.05 1.10 0.95 0.5 0.6 0.8 1.0 1.0 1.1 1.0 0.90Consumptive Use 0.9 0.94 1.05 1.26 0.99 1.05 0.5 0.66 1.04 1.40 2.1 2.42 2.6 2.52Land Prep. + /ISM - Wet soil - 1.0 -2.00

Fotatoes: Crop Factor 0.5 0.55 0.65 1.05 1.2 1,2 1.1 0.8Consumptive Use 0.45 0.61 0.65 1.16 1.56 1.68 2.31 1.76Land Prep. +/SMD - 3.0 -1.0 -2.0

Chillies: Crop Factor 0.5 0.55 0.75 1.0 1.1 0.95Consumptive Use 1.05 1.21 1.95 2.8 3.08 2.57Land Prep. +/SMD - 3.0 - 1.0 _ 2.0

Jute: Crop Factor 0.5 0.65 0.90 1.15 1.30 1 40 1.40 1.40Consumptive Use 1.10 1.69 2.52 3.22 3.51 2.94 2.80 2.94Land Prep. +/SMD - 3.0- 1.0 -2.0

EFF. Precipitation- - 1.72 1.72 0.30 0.26 0.05 0.00 0.13 0.13 0.25 0.25 0.50 0.88 1.0 1.81 2.60 3.08 4.00 4.30 3.40 3.30 4.15 4.00 2.80 2.79 43.12 '°

Net Field Reg; Wheat 3.34 0.40 0.61 0.57 0.81 1.05 1.43 0.92 - 9.13Pulses/Oilaeeds - - 0.75 1.0 0.94 1.21 0.97 0.92 0.40 0.55 1.09 1.73 1.86 1.27 - - IZ.70Vegetables (two crops) - _ 0.75 1.0 0.94 1.05 0.37 0.53 0.79 1.15 1.60 1.84 0.60 - 10.62Potatoes 3.40 0.61 0.52 1.03 1.31 1.43 0.81 - 9.11Chillies 3.55 0.63 0.95 0.99 - _ 6.12Jute 3.52 0.69 0.71 0.62 0.43 - _ _ 5.97

Gross Field Req. (Assuming 29/loss for non-rice crops). -

Wbeat - 4.18 0.50 0.76 0.71 1.01 1.31 1.79 1.15 - 11.41Pulses/OilReeds - - 0.94 1.25 1.18 1.51 1.20 1.20 0.50 0.69 1.35 2.16 2.33 1.59 - _ 15.90Vegetables (two crops) - - 0.94 1.25 1.18 1.31 0.46 0.66 0.99 1.44 2.0 2.3 0 75 - 13.28Potatoes 4.25 0.76 0.65 1.29 1.64 1.79 1.01 - 11.39Chillies 4.44 09 1.19 1.24 - 7.66Jute 4.4 0.96 0.89 0.78 0.54 - - - 7.47

1I Dacca taken as representative.o/ Por land preparation (land Prep.) of rice crops, it is assumed that 6 inches of water has to be supplied; for wheat and other rabi crops only 3 inches. Wheat or rabi crops when cultivated just after

harvesting of the previous crop do not need water for land preparation, Soil moisture depletion (SMD) was allowed for in the last crop month: rice 4 inches and other crops 3 inches.3/ Effective precipitation is calculated from the average rainfall to determine avers8e pumping req,uirements. The effective rainfall was deduced from the recorded rainfall at Dacca by applying the

criteria developed by ACRES Int. (Guideline for the calculation of optimal surface drainage capacities for water projects in East Pakistan, 1971).Rice: From May to October Reff '0-8 x Rrecord.

Fro November to April : R - Reff record.

Other crops: For every month : R - 0.6 x Reff record.

4. For non-rice crops, a water distribution efficiency of 80% is used while for rice an efficiency of 90% is used because a field lOBS f two inches per month to deep percolation is included with the

rice water requir-emnts.

Source: Evapotranspiration in'ex, effective rainfall and crop factors taken from "Bangladesh Land and Water Resources Sector Study", TDA Report PS-13, 1972, Technical Report No. 20, "Overall Water CS

Resources Potential".

December 12, 1980.

BANGLADESH

HAND TUBEWELLS PROJECT

Summary of Bi-Monthly Field Irrigation Requirements (in inches of water)

October November December January February March April May June July August September

a b a b a b a b a b a b a b a b a b a b a b a b

Boro: 5.8 5.8 2.7 3.3 3.5 2.7 3.2 - -

n u r a e r y 4.6 4.5 2.5

T. Aus: 5.3 5.7 1.1 0.5 - - -

n u r s e ry 4.7 5.4 2.1

T. Aman: 1.2 1.6 2,8 - - 0.8 1.5 - - - _ 0.1

Wheat: 4.2 0.5 0.8 0.7 1.0 1.3 1.8 1.2 -

Pulses/Oilseeds - - 0.9 1.3 1.2 1.5 1.2 1.2 0.5 0.7 1.4 2.2 2.3 1.6

Vegetables: - - 0.9 1.3 1.2 1.3 0.5 0.7 1.0 1.4 2.0 2.3 0.8 -

Potatoes: 4.3 0.8 0.7 1.3 1.6 1.8 1.0 -

Chillies: 4.4 0.8 1.2 1.2

Jute: 4.4 0.9 0.9 0.8 0.5

D21

December 12, 1980.

- 51 -ANNEX 2Table 5

BANGLADESH

HAND TUBEWELLS PROJECT

Relationship between Pump Discharge andWater Table Depth

Water Table Discharge -

Depth(ft) (Imp.Gals. per Min.)

10 16

15 11

20 8

25 6

30 4

1/ At 60 percent efficiency.

December 12, 1980.

- 52 -

ANNEX 2

BANGLADESH Table 6

HAND TUBEWELLS PROJECT

Cropping Systems by Land Elevation With and Without HTW

MODEL I MODEL II MODEL III MODEL IV

Land Elevation - High (Flood Plain) Medium Low Low (Flood Plain)

Average annual flood depth (ft) 0 - 1 1 - 3 3 - 6 > 6Cultivated area represented byland type (M.ac) 6.0 9.0 4.0 3.5

Percentage of total cultivated area 27 39 18 16Approx. depth of water table at end

of dry season (ft) 18 - 30 14 - 18 10 - 14 (10Cultivated area suitable for

HTW (M.ac) 1.13 3.38 1.58 1.13Percentage of total cultivated areasuitable for HTW 2/ 5 15 7 5

Percentage of HTW supplied toeach model 16 46 22 16

Cropping systems (per acre)- * __ w P W_ w P W w PW

PaddyBoro local 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.0 0.1 0.1 0.1Boro HYV 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.2 0.0 0.0 0.3B. Aus (local) 0.3 0.3 0.2 0.4 0.4 0.3 0.5 0.5 0.4 0.0 0.0 0.0T. Aus HYV 0.0 0.0 0.1 0.0 0.0 0.1 0.0 0.0 0.1 0.0 0.0 0.0B. Aman (local) 0.1 0.1 0.0 0.1 0.1 0.0 0.5 0.5 0.5 0.7 0.7 0.7T. Aman (local) 0.4 0.2 0.1 0.4 0.3 0.1 0.0 0.0. 0.0 0.0 0.0 0.0T. Aman HYV 0.1 0.3 0.5 0.1 0.2 0.5 0.0 0.0 0.0 0.0 0.0 0.0

Wheat 0.0 0.0 0.2 0.1 0.1 0.2 0.1 0.1 0.3 0.0 0.0 0.0Potatoes 0.0 0.0 0.1 0.0 0.0 0.1 0.0 -0.0 0.0 0.0 0.0 0.0Chillies 0.0 0.0 0.1 0.0 0.0 0.1 0.0 0.0 0.1 0.0 0.0 0.0Pulses 0.1 0.1 0.0 0.1 0.1 0.1 0.3 0.3 0.1 0.2 0.2 0.2Oilseeds 0.0 0.0 0.1 0.0 0.0 0.1 0.0 0.0 0.1 0.0 0.0 0.1Jute 0.2 0.2 0.2 0.2 0.2 0.2 0.0 0.0 0.0 0.0 0.0 0.0Vegetables 0.1 0.1 0.1 0.0 0.0 0.1 0.0 0.0 0.1 0.0 0.0 0.1

Cropping intensity % 1.3 1.3 1.7 1.4 1.4 1.9 1.5 1.5 1.9 1.0 1.0 1.5

1/ Correspond to average land types (1-3) (4-6) (7-9) (10-13) - see Annex 2, Table 1.2/ Excludes saline areas, flooded land and unsuitable groundwater areas.3/ P = present; W = future without HTW ; W = future with HTW.

December 12, 1980.

BANGLADESH

HAND TUBEWELLS PROJECT

CalCUlation of Pumping Requirements per Acre31

Hi-moonthly Boro T. Aus T. Aman Wheat Pulses Vegetables Potatoes Chillies Jute Oilseedsperiod Model PFR FLU RFL MAD WTD -2 D Hours D Hours D Hours D Hours D Hours D Hours D Hours D Hours D Hours D. Hours

September b 1 0_75 15 11.3 20 8.7 8.3 0.1 5II 12 9.0 16 7.0 9.3 4

III 8 6.0 12 6.0 9.9 4IV 6 4.5 8 3.5 12.0 3

October a r 0.85 15 12.8 20 7.2 9.2 1.2 49II 12 10.2 16 5.8 10.0 45

III 8 6.8 12 5.2 10.5 43Iv 6' 5.1 8 2.9 12.5 36

October b 1 0.95 15 14.3 20 5.7 10.0 1.6 60

II 12 11.4 16 4.6 10.8 56InI 8 7.6 12 4.4 11.0 55VI 6 5.7 8 2.3 13.0 46

November a I 0.85 15 12.8 20 7.2 9.2 2.8 115 0.9 37 0.9 3711 12 10.2 16 5.8 10.0 105 34 34

III 8 6.8 12 5.2 10.5 101 32 32IV 6 5.1 8 2.9 12.5 84 27 27

November b I 0.60 15 9.0 20 11.0 7.6 4.2 208 1.3 64 1.3 64II 12 7.2 16 8.8 8.4 188 58 58

III 8 4.8 12 7.2 9.3 170 53 53IV 6 3.6 8 4.4 11.0 144 45 45

December a I 0.47. 15 7.1 20 12.9 6.8 0.5 28 1.2 67 1.2 67 4.3 238 1II 12 5.6 16 10.4 7.8 24 58 58 208

Tll 8 3.8 12 8.2 8.7 22 52 52 186IV 6 2.6 8 5.4 10.3 18 44 44 157

1/December b I 0.35 15 5.3 20 14.7 6.4 (4.6) (17) 0.8 48 1.5 88 1.3 77 0.8 47

II 12 4.2 16 11.8 7.3 (15) 42 77 67 41ITT 8 2.8 12 9.2 8.2 (13) 36 69 60 37IV 6 2.1 8 5.9 10.0 (11) 30 57 49 30

January a 1 0.27 15 4.1 20 15.9 6.2 (4.5) (17) 42 1.2 73 0.5 30 0.7 43II 12 3.2 16 12.8 6.9 (15) 38 66 27 38

III 8 2.2 12 9.8 7.9 (14) 34 57 24 33IV 6 1.6 8 6.4 9.7 (11) 28 47 19 27

2/January b I 0.17 15 2.6 20 17.4 5.7 5.8 393 2/ 1.0 66 1.2 79 0.7 46 0.3 86

II 12 2.0 16 14.0 6.6 (2.5) 341 2/ 58 68 40 74III 8 1.4 12 10.6 7.7 307 - 48 59 34 64

IV 6 1.0 8 7.0 9.3 259 / 40 49 28 53

February a I 0.12 15 1.8 20 18.2 5.4 5.8 412 1.3 90 1.0 70 1.6 112 0.5 3512 1.4 16 14.6 6.5 342 76 58 93298 1.0 12 11.0 7.6 288 64 50 79 25--6 0.7 8 7.3 9.3 236 52 40 65 20

February b 1 0.07 15 1.1 20 18.9 5.1 2.7 201 1.8 134 1.4 103 1.8 133 0.7 521I 12 0.8 16 15.2 6.4 160 106 82 106 41

III 8 0.6 12 11.4 7.5 135 90 70 90 35IV 6 0.4 8 7.6 9.0 114 76 59 75 29

March a I 0.03 15 0.5 20 19.5 4.7 3.3 264 (4.7) (24) 1.2 96 2.0 160 1.0 80 4.4 353 1.4 112II 12 0.4 16 15.6 6.3 198 (18) 72 120 60 263 84

III 8 0.2 12 11.8 7.3 170 (15) 62 103 52 227 72IV 6 0.2 8 7.8 8.9 138 (12) 50 85 42 186 59

March b 1 0.02 15 0.3 20 19.7 4.5 3.5 294 (5.4) (28) 2.3 193 0.8 67 4.4 369 2.2 184 II 12 0.2 16 15.8 6.2 220 (21) 140 49 267 134 t

III 8 0.2 12 11.8 7.2 184 (18) 120 42 230 115IV 6 0.1 8 7.9 8.8 150 (14) 99 34 188 94

BANGLADESH

HAND TUBEWELLS PROJECT

Calculation of Pumping Requirements per Acre

Bi-monthly Boro T. Aus T. Aman Wheat Pulses Vegetables Potatoes Chillies Jute oiiaeedsperiod Model PFR FLU RFL MAD WTD Q D Hours o Hours D Hours D Hours D Hours D Hours D Hours

April a I 0.00 15 0.0 20 20.0 4.5 2.7 226 5.3 455 - 0.8 67 1.2 101 0.9 75 2.3 193II 12 0.0 16 16.0 6.2 170 (2.1) 330 2/ 49 73 55 140

III 8 0.0 12 12.0 7.2 142 284 42 63 47 120IV 6 0.0 8 8.0 8.7 116 235-/ 35 52 39 100

April b I 0.00 15 0.0 20 20.0 4.5 3.2 268 5.7 477 1.2 101 0.9 75 1.6 13412 0.0 16 16.0 6.2 202 346 73 55 97

8 0.0 12 12.0 7.2 168 298 63 47 846 0.0 8 8.0 8.7 138 247 52 39 69

May a I 0.00 15 0.0 20 20.0 4.5 1.1 92 67II 12 0.0 16 16.0 6.2 67 4p

III 8 0.0 12 12.0 7.2 58 42IV 6 0.0 8 8.0 8.7 48 35

May b I 0.00 15 0.0 20 20.0 4.5 0.5 42 42II 12 0.0 16 16.0 6.2 30 30ITT 8 0.0 12 12.0 7.2 26 26IV 6 0.0 8 8.0 8.7 22 22

- IJune a I 0.05 15 0.8 20 19.2 5.0

II 12 0.6 16 15.4 6.3III 8 0.4 12 11.6 7.4

IV 6 0.3 8 7.7 9.0

June b I 0.15 15 2.3 20 17.7 5.6 0.8 54II 12 1.8 16 14.2 6.5 46

III 8 1.2 12 10.8 7.6 40IV 6 0.9 8 7.1 9.3 32

July a I 0.25 15 3.8 20 16.2 7.0 1.5 81II 12 3.0 16 13.0 6.8 83

III 8 2.0 12 10.0 7.8 72IV 6 1.5 8 6.5 9.6 _ 59 - _

2/ 2/Annual Totals 27.7 13.4 8.0 11.5 7.3 13.4 11.5 7.6 7.5 8.7

1/ Figures in parentheses refer to nursery requirements (1/16 acre).2/ Includes nursery requirement.3/ Two crops per dry season.

NOTE: Definition of symbols

PFR - Percentage of water table fluctuation remaining (Figure G 1).FLU - Av. ann. water table fluctuation, in feet (Table G 3).RFL - Residual fluctuation at date concerned, in feet (PFR X FLU).MAD - Maximum water table depth, in feet (Table C 3).WTD - Water table depth below ground at date concerned, in feet (MAD minus RFL).

Q - Pump discharge in inp. gallons per minute (from Figure L 5).D -Depth of irrigation in inches of water (from Table lR 6).

.Hours - Time required to pump D for one acre with discharge Q, in hours [from: Tm hours = 376.92 (D/Q)].

December 12, 1980.

- 55 -

ANNEX 2BANGLADESH Table 8

HAND TUBEWELLS PROJECT

Per Acre Labor Requirements

Crop Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Boro local C - 12 27 5 5 11 17 6Boro HYV C 2/ 14 29 7 7 13 20 6Boro HYV - I 410 613 558 494 17

II 356 502 418 372 15III 321 423 354 310 13IV 270 350 288 254 11

B. Aus local C 7 13 2 2 12 9T. Aus HYV C 9 19 4 4 20 13T. Aus HYV P 6- I 52 932 134

II 39 676 97III 33 582 84IV 26 482 70

B. Aman local C 7 13 2 1 1 6 14 6T. Aman local C 7 15 21 3 4 16 10T. Aman HYV C 7 15 21 5 4 25 18T. Aman HYV P I 135 54 175

II 129 49 161III 112 47 156IV 91 39 130

Wheat (PW) C 2 2 18 4 12 15Wheat W C 4 4 21 6 15 20Wheat W P I 108 224 96 208 76

II 96 182 72 188 66III 82 154 62 170 58IV 68 128 50 144 48

Potatoes C 25 19 10 25 30Potatoes P I 129 245 80 285

II 112 199 60 238III 97 169 52 223IV 80 140 42 5/ 5/ 187

Chillies PW C 40 - 50 - 25 5Chillies W C 25 40 30 6Chillies W P I 420 202

II 312 146III 269 126IV 220 104

Pulses PW C 3 2 20 3 7Pulses W C 5 5 30 8 12Pulses W P I 152 101 155

II 134 92 135III 116 85 127l/ V 96 72 101

Oilseeds W C 8 7 3 24Oilseeds W P I 87 296 327

II 70 228 237III 60 187 204IV 49 153 169

Jute PW C 23 6 5 3 36 5Jute W C 25 10 5 3 50 9Jute W P I 150 109

II 110 79III 94 68

IV-/75/75Vegetables PW C IV 25 35 - 30 78 57 20 - 35 -/ 30 -/Vegetables W 4/ C 10 25 30 25 30 15 25 15Vegetables W P I 76 173 353 67 101 144

II 67 140 260 49 92 125III 58 120 223 42 85 112IV 47 99 184 35 72 93

1/ C = Cultivation requirements in mandays.2/ P = Pumping requirements in man hours.3/ Oilseeds follow-on from pulses on same land with irrigation of both crops4/ 2 crops of vegetables with HTW irrigation.5/ Includes 15 m.d. per month for traditional irrigation of vegetables and chillies.6/ Figures for Model I, II, III, IV related to water table depth and crop requirements.

December 12, 1980.

- 56 -

ANNEU 2Table9

BANGLADESH

HAND TUBEWELLS PROJECT

Family Manpower Utilization in HTW Operation-/

Average Hoursof Operation

Person per Day

Head of HTW family 3

Adult male family member 3

Adult female family member 2

Non adult family member 1

Total 9

1/ Source: IBA Report, University of Dacca, 1980

BANGLADESH

HAND TUBEWELLS PROJECT

1/ Crop Inputs and Yields Per Acre

Boro Boro B. Aus T. Aus B. Aman T. Aman T. Aman Wheat Potatoes Chillies Pulses Jute Vegetables Oilseeds

Unit (local) (HYV) (local) (HYV) (local) (local) (HYV)IW - w Pw w PW W pW W w iw8 w F W w PW W PtW w w

Seed seer 15 15 35 15 30 16 15 15 40 45 40 24/ 24/ 12 12 4 4 54/ 104/ 4

FertitizerUrea Seer 30 50 20 42 10 20 30 40 25 50 60 10 30 0 0 15 25 15 60 20TSP seer 15 30 15 24 10 10 15 25 15 25 20 4 10 0 20 7 5 10 30 10MP seer 10 15 10 11 0 10 10 10 10 10 20 2 10 0 10 5 5 5 30 10

Manure maund 30 50 20 30 0 0 21 28 25 50 80 50 80 0 0 20 40 50 150 50

Pesticides seer 0.5 1.0 0.5 1.0 0.5 0.5 0.0 1.0 0.0 0.5 0.0 0.0 0.0 0.0 0.5 0.0 0.5 0.8 2.0 0.5

Animal power pair day 20 23 20 23 16 22 20 23 16 19 21 22 22 10 15 17 18 16 28 15

LaborCultivation:

Family3/3Hired man dav 83 96 45 70 46 76 76 95 53 70 109 90 3 101 35 60 78 102 175 - 175 42

Pumping:Model I man hours 0 2,092 0 1.118 0 0 0 364 0 712 733 0 622 0 408 0 628 0 914 710

II man hours 0 1,663 0 812 0 0 0 339 0 604 620 0 458 0 361 0 456 0 733 525III man hours 0 1,423 0 699 0 0 0 315 0 526 541 0 395 0 322 0 392 0 640 451

IV man hours 0 1,184 0 578 0 0 0 260 0 438 449 0 324 0 269 0 323 0 530 371

Yield maund 22 46 16 34 16 21 25 35 18 32 110 5 12 9 15 15 26 35 90 12

l/ Limited to Model IV areas.2/ P = present; W = without IfTW; W with HTW.3/ Includes 15 man days traditional irrigation per month - see Table 8. ax4/ Harvest equivalent x5/ Two consecutive crops of vegetables per dry season with HTW.

December 12, 1980.

- 58 -

ANNEX 2Table 11

BANGLADESH

HAND TUBEWELLS PROJECT

Labor Requirements by Month (man-hours)

Jan. Feb. March April May Ju,ne July August Sept. Oct. Nov. Dec. Total

Model IWithout Project 22 30 99 51 14 38 147 114 17 37 127 94 790With Project:Pumping 42 95 213 183 35 68 - - 27 88 42 44 837Cultural 34 48 150 136 82 50 187 140 22 31 157 148 1,185

Incremental 54 113 264 268 103 80 40 26 32 82 72 98 1,232

Model IIWithout Project 4 3 95 65 16 40 157 121 15 21 102 75 714With Project:Pumping 51 77 158 133 26 65 - - 25 81 47 51 714Cultural 38 52 179 146 83 51 197 147 22 31 163 158 1,267

Incremental 85 126 242 214 93 76 40 26 32 91 108 113 1,267

Model IIIWithout Project 18 28 122 111 25 26 52 36 - 24 73 58 573With Project:Pumping 106 149 161 157 8 - - - - - 60 33 674Cultural 44 86 193 189 106 50 58 39 - 36 118 103 1,022

Incremental 132 107 232 35 89 24 6 3 - T12 15 78 1,123

Model IVWithout Project 14 25 75 77 20 19 6 - - 34 83 50 403With Project:Pumping 104 120 120 97 - - - - - - 14 24 479Cultural 59 126 138 116 94 67 6 - - 46 111 84 847

Incremental 149 221 183 136 74 48 - - - 12 42 58 923

February 2, 1981.

- 59 -

ANNEX 2Tablel2

BANGLADESH

HAND TUBEWELLS PROJECT

Calorie Input/Output Analysis

Incremental Production per year:

Rice: 499 lb/ac = 792,063Wheat: 400 lb/ac = 634,920Total: 1,426,983

2/Incremental Calorie Consumption:-

Pumping: 3.75 cals/min3Cultivation: 2.75 cals/min.-

Incremental Labor Utilization per Acre per year:

Pumping: 687 man hours 4/Cultivation: 487 man hours -

Incremental Calorie Requirements per Acre

Pumping: 154,575Cultivation: 80,355Total: 234,930

Equivalent to 16% of incremental production

1/ At 3,500 cals/kg2/ At rest 1.25 calories per minute3/ Bank staff estimates4/ Weighted average from all models

- 60 -

BANGLADESH ANNEX2

Table 13HAND TUBEWELLS PROJECT

1/Annual Incremental Input Requirements at Full Development-/

Fertilizer

Urea (ton) 4,325TSP (ton) 2,332MP (ton) 1,317Pesticide (ton) 13Animal power (pr. days) 1,705,104Hired labor (man days) 2/ 2,185,560

3'Improved Seed-/

Boro HYV (ton) 35Aus HYV (ton) 32Aman HYV (ton) 197Wheat (ton) 139Potatoes (ton) 62

1/ For 135,000 acres2/ Hired labor required only for pumping.3/ Assumes 20 percent replacement of seed per year.

December 12, 1980.

- 61 -

ANNEX 3BANGLADESH Table 1

HAND TUBEWELLS PROJECT

1 acre Farm Budget - Model I (High-Flood Plain)

WithoutProject Year 1 Year 2 Year 3 Year 4 Year 5 Years 6-10

Inf low: /2' 2/Farm production-/ 2,458 4,368-/ 4,915- 5,461 5,461 5,461 5,461

Outflow:Seeds 62 81 81 81 81 81 81

Fertilizer:Urea 56 143 143 143 143 143 143TSP 26 57 57 57 57 57 57

MP 13 27 27 27 27 27 27

Manure 49 172 172 172 172 172 172Pesticide 32 101 101 101 101 101 101

Animal power 600 900 900 900 900 900 9003 Pipe HTW - 1,660 - - - - -

Transportation andinstallation 3/ - 75 - - - - -

Lift and re-sink-- - 110 110 110 110 110 110

Maintenance - 57 57 57 57 57 57Hired pumping labor - 312 312 312 312 312 312

Miscellaneous 4/ 65 85 85 85 85 85 85Total Outflow 903 3,780 2,045 2,045 2,045 2,045 2,045

Net Benefit Before FinancingTotal 1,555 588 2,870 3,416 3,416 3,416 3,416

Incremental - -967 1,315 1,861 1,861 1,861 1,861

FinancingMedium Term Credit-Loan receipt7/ - 1,494 - - - - -

Debt service- - - 565 505 450 - -

Short Term Credit 8/Loan receipt7, - 1,142 1,142 1,142 1,142 1,142 1,142Debt service- - - 1,198 1,198 1,198 1,198 1,198

Net Benefit After Financing

Total 1,555 3,224 2,249 2,855 2,910 3,360 3,360

Incremental 61 - 1,669 694 1,300 1,355 1,805 1,805N'PV - Tk 8,546 -

j Farm production includes on-farm consumption. Off-farm income is unaffected by projectdue to high incidence of surplus labor during dry season. All figures in constant

1980 values.2/ Full development benefits achieved in 3 years; benefits for years 1 and 2 at 80% and

90% of full development benefits.3/ Tk25 to sink and Tk3O to lift 3 pipe pumpset. This is done twice a year.4/ Tk5O per acre cropped.5/ Financing 90% of cost of pumpset at TCCA, at 13% annual interest rate.

6/ At 12% interest based on incremental net benefits after financing.7/ Debt service adjusted to constant 1980 values by projected inflation (12%).8/ 100% of incremental operating costs.

February 12, 1981.

- 62 -

ANNEX 3

BANGLADESH Table 2

HAND TUBEWELLS PROJECT

1 acre Farm Budget- Model II (Medium Elevation)

(Tk)

WithoutProject Year 1 Year 2 Year 3 Year 4 Year 5 Years 6-10

Inflow: 1 2/ 2/Farm production-/ 2,607 4,707- 5,296- 5,884 5,884 5,884 5,884

Outflow:Seeds 81 95 95. 95 95 95 95Fertilizer:

Urea 61 148 148 148 148 148 148TSP 29 64 64 64 64 64 64MP 15 30 30 30 -30 30 30Manure 43 177 177 177 177 177 177

Pesticide 34 109 109 109 109 109 109Animal power 655 988 988 988 988 988 9882 Pipe HTW - 1,320 - - - - -Transportation and

installation 3/ - 60 - - - - -Lift and re-sink- - 90 90 90 90 90 90Maintenance - 57 57 57 57 57 57Hired pumping labor - 101 101 101 101 101 101Miscellaneous 4/ 70 95 95 95 95 95 95

Total Outflow 988 3,334 1,954 1,954 1,954 1,954 1,954

Net Benefit Before FinancingTotal 1,619 1,373 3,342 3,930 3,930 3,930 3,930Incremental - -246 1,723 2,311 2,311 2,311 2,311

FinancingMedium Term Credit-

Loan receipt7, - 1,188 - - - _ _Debt service- - - 449 401 358 - -

Short Term Credit'8/Loan receipt - 966 966 966 966 966 966Debt service- - - 1,013 1,013 1,013 1,013 1,013

Net Benefit After FinancingTotal 1,619 3,527 2,846 3,482 3,525 3,883 3,883Incremental - 1,908 1,227 1,863 1,906 2,264 2.264

NP77= TK11,135-t/

1/ Farm production includes on-farm consumption. Off-farm income is unaffected by projectdue to high incidence of surplus labor during dry season. All figures constant 1980 values.

2/ Full development benefits achieved in 3 years; benefits for years 1 and 2 at 80% and 90%of full development benefits.

3/ Tk2O to sink and Tk25 to lift 2 pipe pumpset. This is done twice a year.4/ Tk5O per acre cropped.5/ Financing 90% of cost of pumpset at TCCA, at 13% annual interest.6/ At 12% interest based on incremental net benefits after financing.7/ Debt service adjusted to constant 1980 values by projected inflation (12%).8/ 100% of incremental operation costs.

December 12, 1980.

- 63 -

ANNEX 3Table 3

BANGLADESH

HAND TUBEWELLS PROJECT

1 acre Farm Budget - Model III (Low Land)(TK)

WithoutProject Year 1 Year 2 Year 3 Year 4 Year 5 Years 6-10

Inflow: 1/ 2/ 2Farm production- 2,348 4,063- 4,5712- 5,079 5,079 5,079 5,079

Outflow:Seeds 107 131 131 131 131 131 131Fertilizer:

Urea 47 122 122 122 122 122 122TSP 28 61 61 61 61 61 61MP 10 24 24 24 24 24 24Manure 36 147 147 147 147 147 147

Pesticide 46 101 101 101 101 101 101Animal power 615 915 915 915 915 915 9152 Pipe HTW - 1,320 - - - - -

Transportation andinstallation - 60 - - - - -

Lift and re-sink3/ - 90 90 90 90 90 90Maintenance - 57 57 57 57 57 57Hired pumping labor - 292 292 292 292 292 292Miscellaneous 4/ 75 95 95 95 95 95 95

Total Outflow 964 3,415 2,035 2,035 2,035 2,035 2,035

Net Benefit Before FinancingTotal 1,384 648 2,536 3,044 3,044 3,044 3,044Incremental - -736 1,152 1,660 1,660 1,660 1,660

Financing 5/Medium Term Credit-

Loan receipt - 1,188 - - - - -

Debt service7/ - - 449 401 358 - -

Short Term Credit-/Loan receipt7 / - 1,071 1,071 1,071 1,071 1,071 1,071Debt service-/ - - 1,124 1,124 1,124 1,124 1,124

Net Benefit After FinancingTotal 1,384 2,907 2,034 2,590 2,633 2,991 2,991Incremental _ 1,523 650 1,206 1,249 1,607 1,607

NPV = TK7729-1,

1/ Farm production includes on-farm consumption. Off-farm income is unaffected by projectdue to high incidence of surplus labor during dry season. All figures constant 1980 values.

2/ Full development benefits achieved in 3 years; benefits for years 1 and 2 at 80% and 90%of full development benefits.

3/ Tk2O to sink and Tk25 to lift 2 pipe pumpset. This is done twice a year.4/ Tk5O per acre cropped.5/ Financing 90% of cost of pumpset at TCCA, at 13% annual interest.6/ At 12% interest based on incremental net benefits after financing.7/ Debt service adjusted to constant 1980 values by projected inflation (12%).8/ 100% of incremental operating costs.

December 12, 1980.

- 64 -

ANNEX 3Table4

BANGLADESH

HAND TUBEWELLS PROJECT

1 acre Farm Budget - Model IV (Low-Flood Plain)

WithoutProject Year 1 Year 2 Year 3 Year 4 Year 5 Years 6-10

Inf low: 1, 2/ 2/Farm production- 1,578 3,185- 3,583- 3,981 3,981 3,981 3,981

Outflow:Seeds 64 83 83 83 83 83 83Fertilizer:

Urea 23 76 76 76 76 76 76TSP 15 46 46 46 46 46 46MP 1 16 16 16 16 16 16Manure 7 87 87 87 87 87 87

Pesticide 34 88 88 88 88 88 88Animal power 380 685 685 685 685 685 6852 Pipe HTW - 1,320 - - - - -

Transportation andinstallation - 60 - - - - -

Lift and re-sink-/ - 90 90 90 90 90 90Maintenance - 57 57 57 57 57 57Hired pumping labor - - - - - - -Miscellaneous 4/ 50 75 75 75 75 75 75

Total Outflow 574 2,683 1,303 1,303 1,303 1,303 1,303

Net Benefit Before FinancingTotal 1,004 502 2,280 2,678 2,678 2,678 2,678Incremental - -502 1,276 1,674 1,674 1,674 1,674

FinancingMedium Term Credit-Loan receipt7 - 1,188 - - - - -Debt service-/ - - 449 401 358 - _

Short Term Credit -/Loan receipt- 2,109 2,109 2,109 2,109 2,109 2,109Debt service7/ - - 2,213 2,213 2,213 2.213 2,213

Net Benefit After FinancingTotal 1,004 3,799 1,727 2,173 2,216 2.574 2,574Incremental - 2,795 723 1,169 1,212 1,570 1,570

NPV = Tk 8,776

1/ Farm production includes on-farm consumption. Off-farm income is unaffected by projectdue to high incidence of surplus labor during dry season. All figures constant 1980 values.

2/ Full development benefits achieved in 3 years; benefits for years 1 and 2 at 80% and 90%of full development benefits.

3/ Tk2O to sink and Tk25 to lift 2 pipe pumpset. This is done twice a year.T/ Tk5O per acre cropped.5/ Financing 90% of cost of pumpset at TCCA, at 13% annual interest.16/ At 12% interest based on incremental net benefits after financing.7/ Debt service adjusted to constant 1980 values by projected inflation (12%).8/ 100% of incremental operating costs.

December 12, 1980

- 65 -

ANNEX 4

Table 1

BANGLADESH

HAND TUBEWELLS PROJECT

Phasing of HTW Distribution

Percentage-/ Year 1 Year 2 Year 3 Total

Model I 12 4,800 7,200 9,600 21,600Model II 34 13,600 20,400 27,200 61,200Model III 17 6,800 10,200 13,600 30,600Model IV 12 4,800 7,200 9,600 21,600Drinking Water 25 10,000 15,000 20,000 45,000

Total 100 40,000 60,000 80,000 180,000

Cumulative 40,000 100,000 180,000

1/ Percentage of HTWs in any year going to each end use.

November 18, 1980.

- 66 -

ANNEX 4Iab-i.e 2.

BANGLADESH

HAND TUBEWELLS PROJECT

Cost of I HTWi

Quantityof Price/Unit Price/Utnit 2 Pipe If6del 3 Pipe Model

Units (s) (Tk) Total Total(Tk) (Tk)

A. Raw Material Procuredby DPHE

Pig Iron .03636 T 349 203.0 203.0Hard Coke .00909 T 230 33.5 33.5Taxes and Duties: Pig Iron .03636 T 1396 50.8 50.8

Coke .00909 T 736 6.7 6.7Transport to DPHE 2/ .04545 T 200 9.1 9.1

B. Local Fabrication 2/

Transport Raw mat. .04545 T 100 4.5 4.5Nuts, Bolts, and Washer (set) 1 No. 28 28.0 28.0Long Pin " 2 2.0 2.0Short Pin " 5 5.0 5.0Piston Rod 15 15.0 15.0Leather Valve 5 5.0 5.0Bucket " 5 5.0 5.0Labor (wages) 3 m.d. 25 75.0 75.0Overheads 48.5 48.5Transport to DPHE 1 3 3.0 3.0

Subtotal B 191.0 TYIYU

Cost of 1 pumphead at DPHE 494.1 494.1

C. Pipes and Strainer

C.I.F. (pipes) 46 ft .90 14.4 662.466 ft .90 14.4 950.4

Duties and taxes 46 ft 8.64 397.466 ft 8.64 570.2

D. Transport pipes to DPHE .07 T 200 14.0

.095 T 200 19.0E. Strainer Fabrication

Transport pipes to foundry2-.0075 T 100 .8 .8Holing 2/ 6 ft 2 12.0 12.0Transport strainers to DPHE .007 T 100 .7 .7

Full cost of Pumpset at DPHE 1581.4 2047.2

Cost of Pumpset at DPHE excluding taxes and duties 1126.5 1419.5

F. Local Distribution and Installation

Transport to TCCA- 3/ 20 25Service Charge at TCCA- 169 213

Cost of Pumpset to farmer at TCCA 1315.5 1657.5

Rounded to 1320 1660

Transport to site 40 50Installation charge 20 25

Cost to farmer of installed pumpset 1380 1735

1/ For 2 G.I pipe and 3 G.I pipe pumpsets.2/ Includes handling costs.3/ Service Charge at TCCA amounts to 15% of the net of tax and duty price

of a pumpset at DPHE.

February 5, 1981.

- 67 -

ANNEX 4Table 3

BANGLADESH

HAND TUBEWELLS PROJECT

Spare Parts Cost and Replacement Schedule -(No. 6 Hand pump)

Expected No. of replace- Avg. annualUnit Price life ments over replacement

Item (Tk) (years) 10 year life -/ cost

Leather Bucket 6.00 1/2 19 11.4

Leather Seat Valve 2.75 1/2 19 5.2

Plunger 8.75 2 4 3.5

Piston Rod 5.00 1 9 4.5

Barrel 115.00 10 2/

Head Cover 42.00 10 2/

Handle 42.00 3 2.33 9.8

Base Plate 41.00 10 2/ -

Valve Weight 2.50 2 4 1.0

Long Pin 2.80 1 9 2.5

Short Pin 2.40 1 9 2.2

Nuts and Bolts (4) 8.00 1 9 7.2

Coir for Strainer 5.00 1/2 19 9.5

Average Annual Maintenance Cost Tk 56.8

rounded Tk 57

1/ The life of a pump is estimated at 10 years, under the assumed use andmaintenance schedule.

2/ Pumplife of 10years limited by pipe and strainer deterioration.

3/ Number of replacements = (pumplife - part life)/partlife.

November 12, 1980.

-68 -

ANNEX 4Table 4

BANGLADESH

HAND TUBEWELLS PROJECT

Project Staffing

Grade Incremental TotalNo. Tk. No. Tk.

IRDP Headquarters

A. Office of Deputy DirectorDeputy Director 7 - - 1 36,877M&E Asst. 14 1 8,805 1 8,805Admin. Asst. 14 - - 1 8,805Stenographer 15 - - 1 8,022Typist 17 - - 1 6,386

Messenger 21 - - 2 9,536Driver 1/ 17 1 8,786 1 8,786

B. Office of Aost. DirectorTraining and Credit

Asst. Director 10 - - 1 19,746Training Asot. 14 - - 1 8,805Credit Asst. 14 - - 1 8,805Typist 17 - - 1 6,386Messenger 21 - - 1 4,768

C. Office of Asst. DirectorDistribution and Accounto

Asst. Director 10 - - 1 19,746

Distribution Asst. 14 - - 1 8,805Account Asst. 14 - - 1 8,805Typist 17 - - 1 6,386Messenger 21 - - 1 4,768

IRDP - Total 2 .7t5 18 184,236

DPHE Headquarters

A. Office of Exec. EngineerExec. Engineer 7 - - 1 36,877Admin. Officer 12 - - 1 10,545Accounts Officer 12 - _ 1 10,545Admin. Asst. 14 - - 2 17,610Account Asst. 14 - - 1 8,805Stenographer 14 - - 1 8,805Typist 17 - - 2 12,772Messenger 21 - - 3 14,304Driver 1/ 17 2 17,572 2 17,572

B. Office of Tendering and Procur ementAsst. Engineer 8 1 31,997 1 31,997Typist 17 1 6,386 1 6,386Messenger 21 1 4,768 1 4,768

C. Office of Quality ControlAsst. Engineer 8 1 31,997 1 31,997Typist 17 1 6,386 1 6,386Messenger 21 1 4,768 1 4,768

D. Office of DistributionAsat. Engincer 8 1 31,997 1 31,997Typist 17 1 6,386 1 6,386Messenger 21 1 4,768 .1 4,768

DPEE Headquarters - Total 11 147,025 23 267,288

DPHE Center Store

A. ChittagongAccount Asst. 14 - - 1 8,805Typist 17 - - 1 6,386Messenger 21 - - 1 4,768Driver 1/ 17 3 26,358 3 26,358Driver/Helper 17 3 19,158 3 19,138

B. DaccaSubdiv. Engineer 6 - - 1 31,997Account Asst. 14 - - 0 A0Rn5Typist 17 - - 1 6,386Messenger 21 - - 1 4,76g

Driver 1/ 17 2 17,572 2 17,572Driver/Helper 17 2 12,772 2 12,772

C. YhulnaSubdiv. Engineer 8 - - 1 31,997Account Aoot. 14 - - 1 8,805Typist 17 - - 1 6,386Messenger 21 - - 1 4,768Driver 1/ 17 3 26,358 3 26,358Driver/Helpec 17 3 19,158 3 19,158

D. NatoreAccount Asst. 14 1 8,805 1 8,805Typist 17 1 6,386 1 6,386Messenger 21 1 4,768 1 4,768Driver 1/ 17 2 17,572 2 17,572Driver/Helper 17 2 12,772 2 12,772

DPHE Center Store - Total 23 171,679 34 295,550

TOTAL Project Staffing 36 336,295 75 747,074

1/ Salary of Tk6,386 plus Travel Allowa-c.s of Tk2,400.

April 6, 1981.

- 69 -

BANGLADESH ANNEX 4Table 5

HAND TUBEWELLS PROJECT

IRDP and DPHE

Incremental Staffing Costs (Tk'OOO')

Unit Year 1 Year 2 Year 3 IncrementalCost No. Cost No. Cost No. Cost Cost

IRDP HeadquartersA. Office of Deputy Director

M&E Asst. 8.8 1 8.8 1 8.8 1 8.8 26.4Driver 8.8 1 8.8 1 8.8 1 8.8 26.4

Total IRDP Headquarters 2 1TT? 2 17.6 2 17.6 52.8

DPHE HeadquartersA. Office of Exec. Engineer

Driver 8.8 2 17.5 2 17.5 2 17.5 52.5

B. Office of Asst. Eng. TenderingAsst. Engineer 32.0 1 32.0 1 32.0 1 32.0 96.0Typist 6.4 1 6.4 1 6.4 1 6.4 19.2Messenger 4.8 1 4.8 1 4.8 1 4.8 14.4

C. Office of Asst. Eng. QualityControl and MonitoringAsst. Engineer 32.0 1 32.0 1 32.0 1 32.0 96.0Typist 6.4 1 6.4 1 6.4 1 6.4 19.2Messenger 4.8 1 4.8 1 4.8 1 4.8 14.4

D. Office of ShippingShipping Officer 32.0 1 32.0 1 32.0 1 32.0 96.0Typist 6.4 1 6.4 1 6.4 1 6.4 19.2Messenger 4.8 1 4.8 1 4.8 1 4.8 14.4

Total DPHE Headquarters 11 147.1 11 147.1 11 147.1 441.3

DPRE Center StoresA. Chittagong

Driver 8.8 3 26.4 3 26.4 3 26.4 79.2Driver/Helper 6.4 3 19.1 3 19.1 3 19.1 57.3

B. DaccaDriver 8.8 2 17.6 2 17.6 2 17.6 52.8Driver/Helper 6.4 2 12.8 2 12.8 2 12.8 38.4

C. KhulnaDriver 8.8 3 26.4 3 26.4 3 26.4 79.2Driver/Helper 6.4 3 19.1 3 19.1 3 19.1 57.3

D. NatoreAccount Asst. 8.8 1 8.8 1 8.8 1 8.8 26.4

Typist 6.4 1 6.4 1 6.4 1 6.4 19.2Messenger 4.8 1 4.8 1 4.8 1 4.8 14.4Driver 8.8 2 17.6 2 17.6 2 17.6 52.8Driver/Helper 6.4 2 12.8 2 12.8 2 12.8 38.4

Total DPHE Center Stores 23 171.7 23 171.7 23 171.7 515.1

Total - Incremental Staff 36 336.3 36 336.3 36 336.3 1,008.9

April 6, 1981.

- 70 -

BANGLADESH ANNEX 4Table 6

HAND TUBEWELLS PROJECT

Vehicles and Equipmaent Costs by Agency for I.R.D.P. and D.P.H.E.(Tk)

Unit CostC.I.F. Duties Other Total No. Total

& Taxes Charges

A. Vehicles

a) I.R.D.P.Microbus 74,304 36,037 6,620 116,961 1 116,961

b) D.P.H.E.Car (1000 cc) 55,305 60,836 6,968 123,109 1 123,109Commuter (10 seater) 74,304 36,037 6,620 116,961 1 116,961Pickup 92,355 68,343 9,642 170,340 2 340,6805T-Trucks 249,840 121,172 22,261 393,273 8 3,146,184

Total Vehiclea 3,843,895

B. Maintenance and Operating Costs - Yearly

a) I.R.D.P.Repairs 15,000Fuel/oil 40,000

b) D.P.H.E.Repairs 96,000Fuel/oil 296,370

C. Equipment Unit Cost No. Total

a) I.R.D.P.18" typewriter (imp.) 16,000 1 16,00018" typewriter (dom.) 6,500 1 6,50026" typewriter 20,000 1 20,000Duplicating machine 25,000 1 25,000Electric print calculator 6,500 1 6,500Pocket calculator 600 3 1,800Statiso.y 10,000

b) D.P.H.E.26" typewriter 20,000 2 40,000Paper copier 100,000 1 100,000Pocket Calculator 600 2 1,200Gastetner stencil 25,000 1 25,000Stationery - - 20,000

Total Equipment 272,600

D. Office Futniture

a) I.R.D.P.Desks 3,000 1 3,000Revolving chairs 1,500 1 1,500Armless chair 400 2 800

b) D.P.H.E.Desks 3,000 4 12,000Revolving chair 1,500 4 6,000Armless chair 400 8 3,200Miscellaneous 5,000

Total Office Furniture 3I,500

Total Vehicles, Equipment and Furniture 4,147,395

Total Maintenance and Operation (yearly) 447,370

April 6, 1981.

- 71 -

BANGLADESH ANNEX 4Ta=eT7

HAND TUBEWELLS PROJECT

Investments and Operating Costs for I.R.D.P. and D.P.H.E.(Tk '000)

Year 1 Years 2-3 TotalUnit Cost No. Cost No. Cost No. Cost

InvestmentsA. Vehicles

Car 1000 cc. 123.1 1 123.1 - - 1 123.1Microbus 117.0 1 117.0 - - 1 117.0Commuter (10 seater) 117.0 1 117.0 - - 1 117.0Pick-up 170.3 2 340.6 - - 2 340.65T-Trucks 393.3 8 3,146.3 - - 8 3,146.3

Subtotal Vehicles 3,844.0 3,844.0

B. BuildingsCenter Store at Natore 600.0 1 600.0 - - 600.0

C. Office Equipment18 typewriter (imported) 16.0 1 16.0 - - 1 16.0

18" typewriter (dom-script) 6.5 1 6.5 - - 1 6.526" typewriter 20.0 3 60.0 - - 3 60.0Duplicating machine 25.0 1 25.0 - - 1 25.0Gestetner stencil 25.0 1 25.0 - - 1 25.0Paper copier 100.0 1 100.0 - - 1 100.0

Electric print calculator 6.5 1 6.5 - - 1 6.5Pocket calculator 0.6 5 3.0 - - 5 3.0

Stationery and Miscellaneous - - 10.0 - 10.0 - 30.0Subtotal Equipment 252.0 10.0 2Y2.0

D. Office FurnitureDesk 3.0 5 15.0 - - 7 15.0Revolving chair 1.5 5 7.5 - - 7 7.5

Armless chair 0.4 10 4.0 - - 10 4.0Miscellaneous - - 5.0 - - - 5.0

Subtotal Furniture 31.5 31.5

Total Investment Costs 4,127.5 10.0

Operating CostsVehicles 1 - - 447.4 447.4 1,342.2Building maintenance-- - 9.0 9.0 27.0Office operations - - 50.0 50.0 150.0

Total Operating Costs 506.0 506.0 1,518.0

1/ Maintenance at 1 1/2% of capital cost per year.

April 6, 1981.

- 72 -

ANNEX 4Table 8

BANGLADESH

HAND TUBEWELLS PROJECT

Costs of Center Store at Natore

Tk'OO0'1/

Semi-permanent C.I. roof shed5,000 sq. ft. @ TklOO/sq. ft. 500

Guard shed 5" wall and C.I. roof500 sq. ft. @ TklOO/sq. ft. 50

Roadway (brick soling)1,500 sq. ft. @ Tk33/sq. ft. 50

Total cost 600

1/ Corrugated Iron.

November 20, 1980.

- 73 -

ANNEX 4

BANGLADESH Table 9

HAND TUBEWELLS PROJECT

Costs of Toolkits

Unit Year 1 Year 2 Year 3 TotalCost - …------------ Tk '000' ---------------------(Tk) No. No. No. No.

Minor Toolkit l1. Slide wrench 1002. Screwdriver 253. Pull wrench 75

Total Set 200 500 100 667 133 833 167 2,000 400

Major Toolkit 2/1. Chain tong 6002. Slide wrench 3003. Pipe wrench - 18" 345

- 12" 2104. Pipe cutter 5505. Hacksaw w/12 blades 1006. Pliers 1207. Screwdriver 258. Hammer 809. Chain 70

Total Set 2,000 100 200 175 350 225 450 500 1,000

Total Costs of Toolkits 300 483 617 1,400

1/ One for every 15 farmers undergoing training.2/ One for every 4 mechanics trained.

November 17, 1980

- 74 -

BANGLADESH

ANNEX 4HAND TUBEWELLS PROJECT Table 10

TRAINING AND PUBLICITY COSTS

Year 1 Year 2 Year 3 Total

A. TPO/DPO/Acct./PD/DPD atThana and District Level

No. of Thanas 150 200 250No. of Districts 20 20 20No. of Trainees 1/ 490 640 790No. of Trainee Batches2/ 10 13 16Allowance for trainees-3/(Tk) 73,500 96,000 118,500 288,000Honorarium for trainers- (Tk) 15,000 19,500 24,000 58,500Stationery 4/ (Tk) 7,350 9,600 11,850 28,800Miscellaneous (Tk) 2,150 2,600 2,860 7,610

Total (Tk) 98,000 127,700 157,210 382,910

B. Training for Farmers - HTW Users

No. of Thanas 5/ 150 200 250No. of Trainees- 6/ 7,500 10,000 12,500Allowance for trainees-7, (Tk) 375,000 500,000 625,000 1,500,000Honorarium for trainers- (Tk) 75,000 100,000 125,000 300,000Miscellaneous (Tk) 15,000 20,000 25,000 60,000

Total (Tk) 465,000 20,000 775,000 1,860,000

C. Training for Mechanics

No. of Thanas 8 150 200 250No. of Trainees- 400 700 900No. of Batches 9/ 15 20 25Allowance for traineesT-o/ (Tk) 60,000 105,000 135,000 300,000Allowance for trainers- (Tk) 13,500 18,000 22,500 54,000Stationary 11/ (Tk) 7,500 10,000 12,500 30,000Miscellaneous (Tk) 1,500 2,000 2,500 6,000

Total (Tk) 82,500 135,000 172 0 390,000

D. Preparation of Training Material and Publicity

Manuals-2' (Tk) 52,500 70,000 87,500 210,000Booklets, Posters andother Publicity (Tk) 120,000 180,000 240,000 540,000

Total (Tk) 172,500 250,000 327,500 750,000

Total Training and Publicity Costs 818,000 1.132,700 1,432,710 3,382,910

1/ Training for TPO/DPO/Acct. in each Thana, and PD/DPD in each district.2/ Tk5O/day for 3 days course per trainee3/ TklOO/day for 5 trainers per batch for 3 days.4/ Tkl5/trainee.5/ 50 Farmer-trainees per TCCA.6/ Tk25/day per trainee for 2 days.7/ Tk5O/day for 5 trainers for 2 days for each TCCA.8/ 5 Trainees per TCCA per year.9/ Tk25/day per trainee for 6 days.10/ Tk5O/day for 3 trainers for 6 days for each batch.11/ TklO/trainee.12/ Manuals at Tk7 each for each farmer trainee.

November 17, 1980.

- 75 -

BANGLADESH ANNEX 4

HAND TUBEWELLS PROJECT

Research and Testing Component(Tk '000')

Year 1 Year 2 Year 3 TotalNo. No. No.

Staff-/ 2/Professor- 2 20 2 20 2 20 60Graduate Engineer 3/ 2 80 2 80 2 80 240Manual Irrigation Expert- 1 580 1 580 - - 1,160Stenographer 1 9 1 9 1 9 27Typist 1 7 1 7 1 7 21Messenger 2 10 2 10 2 10 30Driver 1 10 1 10 1 10 30Admin. and Accts. Assistant 1 10 1 10 1 10 30

Subtotal 726 726 146 1,598

Equipment, Furniture, and SuppliesJeep 1 266 - - - - 266Bicycles for field interviewers 5 11 - - - - 11Laboratory Equipment - 30 - - - - 30Prototype Pumps 30 90 15 45 - - 135International Freight 30 150 15 75 - - 225Typewriter 2 13 - - - - 13Electric Print Calculator 2 13 - - - - 13Office Furniture - 20 - - - - 20Office Supplies - 5 - 5 - 5 15Vehicle Maintenance - 5 - 5 - 5 15Lab. supplies and Industrial service - 400 - 300 - - 700

Subtotal 1,003 430 TO 1,443

Office Rental 100 100 100 300

Travel and Subsistence6 International round trips 203 67 - 2704 Months subsistence abroad 140 - - 140Local travel

Vehicle running costs 35 35 35 105Subsistence 4/ 30 30 30 90

Subtotal 408 132 65 605

Field Evaluation of Existing PumpsLocal interviewers 50 50 50 150Survey forms and other supplies 12 12 12 36

Subtotal 62 62 62 186

Miscellaneous 115 28 15 158

Total 2,221 398 4,290

1/ Staff salaries include 10% premium on government salaries for temporary nature of post.Professor on part time (10%) basis. Salaries include overheads.

3/ Internationally recruited consultant, 3 man-months in year 1 and 2.4/ Subsistence for 150 man-days per year.

February 5, 1981.

- 76 -

ANNEX 4

BANGLADESH

HAND TUBEWELLS PROJECT

GOB Net Contribution to Proiect Costs(Tk millions)

Year 1 Year 2 Year 3

Project Cost Expenditures 17.3 24.2 32.7Inflow from Farmers' Payments-Cash Purchase 2/ - 9.2 15.4Downpayment 3/4/- 5.2 8.7Loan Repayment- - - 17.5

Net GOB Contribution (Sub-Total) 17.3 9.8 (8.9)

1/ Inflows delayed by one year to reflect true burden on GOB budget.2/ 15% of HTWs and Toolkits sold.3/ 10% of HTWs and Toolkits purchased on MT credit (85%).4/ Excluding interest payments.

April 13, 1981.

BANGLADESH

HAND TUBEWELLS PROJECT

Locus of Benefit-Cost Switching Values

51

49

42

o 35

28

8~~~- - - - - - - - - -- - - - - - - - - - - - - -- -- - -- - -- - -

21 4+

14 K

t >

7

+

+

0 +

-1 -5 -9 -13 -16 -20 -24 -27 -31

Percentage Shortfall In BenefitsLegend

P z

*+ + = Maximum Expected Fall in Benefits is 20.0% I JMaximum Expected Rise in Costs is 25.0%

- -~ Target Yield of 0.0%; Benefit Switching Point is -31.2%; Cost Switching Point is 45.3%.

- 78 -

ANNEX 5Table 1

BANGLADESH

HAND TUBEWELLS PROJECT

Financial and Economic Prices

A. Crops and Seeds

Financial EconomicSeeds Crops Seeds Crops

(Tk/seer) (Tk/mnd) (Tk/seer) (Tk/mnd)

Paddy 2.6 105 3.8 155Wheat 2.5 100 4.4 1/ 175Potatoes 1.1 45 0.8 1/ 34Chillies 8.7 345 6.5 259Pulses 2/ 2.4/4.3 95/170 1.8/3.2 1/ 71/127Oiloced8i 4.4 175 10.3 410Jute 4.4 135 7.7 183

Vegetables 1/ 1.1 3/ 45 0.8 1/3/ 34

B. Fertilizers and Pesticide

Tk/seer Tk/seer

Urea 2.3 4.2TSP 1.8 5.0MP 1.4 3.3Manure (Tk/mnd) 2.3 1.7 1/Pesticide 4/ 84 252 4/

C. Animal Power and Wages

Tk Tk

Animal Power/pair day 25 18.8 6/Hired Labor/man-day 5/ 10 5.1 7/

1/ Nontraded commodities adjusted by SCF = .75.2/ The quality of pulses grown with the HTW (Tkl7O/mnd) is better than

that grown without the HTW tTk90/mnd).3/ Crop price equivalent.4/ Pesticides used are subsidized at about 67%. Therefore, the price used

in the economic analysis is taken at 3 times the financial price.5/ One man-day of pumping is equal to 5 hours; cultural work, 8 hours.6/ Adjusted by SCF = .75.7/ The economic price of labor is taken at 68% of the financial price,

adjusted by the SCF = .75.

April 13, 1981.

- 79-

ANNEX 5Table 2

BANGLADESH

HAND TUBEWELLS PROJECT

Price of Internationally Traded Commodities, 1982-90 averagefor Economic Analysis

CommodityOil

Item Paddy Wheat Jute Seeds Urea TSP MP

1. Projected Avg. 1982-90 World MarketRice price (US$/ton)l/ 2/ 555 241 495 642 257 217 109

2. Adjustments for quality differentials -167=A - - - - - -

3. Projected price adjusted forquality (US$/ton) 388 241 495 642 257 217 109

4. Shipping costs to/from 5/Chittagong (US$/ton) +37 +59 - +44 +15- +59 +59

5. FOB/CIF Chittagong price (US$/ton) 425 300 495 686 272 276 168

4/6. Handling and Transport-/cost between

the Port and the Wholesale Market/Main Godowns (US$/ton) +50 +44 -63 +50 -25 +25 +25

7. Market/Ex-Godowns price (US$/ton) 475 344 432 736 247 301 193

8. Processing, handling-/and transportcosts between the WholesaleMarket/Godown and the Farm Gate(US$/ton) -76 -51 -51 -51 +30 +30 +30

9. Farm Gate Price (US$/ton) 399 293 381 685 277 331 223

10. Processing Ratio (%) 65 100 80 100 100 100 100

11. Farm Gate Price adjusted forprocessing losses (US$/ton) 259 293 305 685 277 331 223

12. (Tk/md) 155 175 183 410 166 198 133

1/ Source: IBRD Price forecasts dated November 1980. The forecasts are in 1980 constantdollars.

2/ Pricing Basis: Rice : Thai, milled 5% broken, FOB Bangkok.Wheat Canadian No. 1 Western Red Spring, ex-store Thunder Bay.Jute : Bangladesh white D.FOB Chittagong/Chalna.Oilseeds: Groundnuts, shelled, cif Europe.Urea : Bagged, FOB Europe.TSP : FOB US Gulf.MP : FOB Vancouver.

3/ For 25-35% broken. A 30% discount is taken.4/ Costs established by a GOB study of these costs and adjusted by SCF = .75./ Assuming Bangladesh would be an exporter and because of proximity to markets in

South Asia would command a Drice advantage over Eurovean suvpliers.

February 5, 1981.

BANGLADESH

HAND TUBEWELLS PROJECT

Economic Benefit and Cost Stream(Tk '000')

Benefits-/ Costs-Increment;l Net

1/ Drinking HTW Working EconoraicYear - Irrigation Water Total Production Overheads Farm Inputs Farm Labor Capital 21 Total Beoefits

1 0.00 0.00 0.00 5o001.00 9534.94 0.00 0.00 30744.00 90297.84 -90297.342 70982.00 1750.00 7Z732.00 75029.00 5064.13 31172.00 30318.00 4393G.00 1e5517.13 -112765.13

3 199259.00 4375.00 203633.00 100039.00 5437.13 73569.00 7579o.00 59743.0c 314578.13 -110945.13

4 3ss739.00 7875.00 403014.00 0.00 °.c*° 132423.00 136422.00 0.00 2s8845.00 13476S.00

*5 472084.00 7875.00 479939.00 0.00 0.00 132423.00 136422.00 o.oo 268645.00 211094.00

s 515667.00 7875.00 523562.00 0.00 0.00 132423.00 136422.00 0.00 zGe845.00 254717.00

7 515687.00 7875.00 523532.00 0.00 0.00 132423.00 136422.00 0.00 260845.00 254717.00 1

8 5156a7.00 7875.00 523562.C0 0.00 0.00 132423.0c 136422.00 .0.00 268845.00 25A717.00 09 515667.00 7875.00 523562.00 0.00 0.00 132423.00 136422.00 0.00 26845.00 254717.00 o10 515G87.00 7875.00 5235G2.00 0.00 0.0o 132423.00 136422.00 0.00 268845.00 254717.00 I

11 515687.00 7075.00 523562.00 0.00 0.00 132423.00 136422.00 o.00 268845.00 254717.00

12 401089.00 7875.00 408964.00 0.CIO 0.00 1029SG.00 10IO06.00 0.00 209102.00 199862.00

13 z22194.00 7875.00 237069.00 0.00 0.00 50854.00 60632.00 -134423.00 -14937.00 252006.00

NPV ot 12% - Tk658 MERR - 44%

1/ All benefits, and costs, except investment costs (HTW production and overheads), for purposes of this economic analysis

only,are deferred by one year along with the introduction of a dummy incremental working capital stream, to adjust for theapproximate semi-annual nature of the crops involved. This methodology is outlined in "Methodology of Farm InvestmentAnalysis", by Walter Shaefer-Kehnert, CN-67.

2/ The dummy incremental working capital for each year is equal to 50% of the difference between nonsinvestment costs(i.e. farm inputs and labor) for each year and the following year. These costs are then recovered in the last year.

April 8, 1981.

- 81 -

ANNEX 6Table 1

BANGLADESH

HAND TUBEWELLS PROJECT

Disbursement Schedule(US$ Millions)

Calendar Year/Quarter DisbursementsQuarterly Cumulative

1981/1

1981/2

1981/3 0.1 0.1

1981/4 1.1 1.2

1982/1 1.1 2.3

1982/2 1.2 3.5

1982/3 1.4 4.9

1982/4 1.5 6.4

1983/1 1.6 8.0

1983/2 1.6 9.6

1983/3 1.7 11.3

1983/4 1.7 13.0

1984/1 2,0 15.0

1984/2 2.0 17.0

1984/3 0.6 17.6

1984/4 0.2 17.8

1985/1 0.2 18.0

April 6, 1981.

-82-

ANNEX 6Table 2

BANGLADESH

HAND TUBEWELLS PROJECT

Detailed Disbursement Allocation(US$ '000')

Direct Foreign Costs Other Costs TotalCosts Financing Disburse- Costs Financing Disburse- Costs Financing Disburse-

Category Ratio (%) ment Ratio (%) ment Ratio (%) ment

1. Imported Raw Materialand G. I. pipes 13,250 100 13,250 6,750 - - 20,000 - 13,250

2. Local Fabrication - - - 3,000 70 2,100 3,000 - 2,100

3. Distribution - - - 700 - - 700 - -

4. IRDP and DPHEVehicles and Equipment 200 100 200 150 - _ 350 - 200

5. Staff Salaries andAllowances - - - 75 - - 75 - -

6. Maintenance andOperation - - - 120 - - 120 - -

7. Civil Works - - - 45 70 32 45 - 32

8. Research and Testing 140 100 140 150 100 150 290 - 290

9. Technical Assistance 430 100 430 - - - 430 - 430

10. Training and Publicity - - - 260 - - 260 - -

11. Toolkits - - - 88 60 50 88 - 50

12. TCCA Marketing andAdm. margin - - - 2,400 - - 2,400 - -

13. Unallocated 1,150 - 1,150 1,230 - 498 2,380 - 1,648

Total 15,170 15,170 14,968 2,830 3 18,000

April 7, 1981.

- 83 -

ANNEX 7Table 1

BANGLADESH

HAND TUBEWELLS PROJECT

Incremental Medium Term Credit Requirements(TK millions)

1981/82 *1982/83 1984/85 Total

MT Credit Requirements 44.60 66.93 89.21 200.74

Mostil/ 44.37 66.56 88.74 199.67Tool Kits/ 0.23 0.37 0.47 1.07

Credit Repayments Due 6.63 24.94 31.57

Regular3/ - 6.63 23.06 29.69Past Due (25% of previous due) - 1.66 6.24 7.90Interest on Overdue 0.22 0.81 1.03

Actual Repayments (75% of 3.0) 4.97 18.71 23.68

Incremental MT Credit Required 44.60 61.96 70.50 177.06$million (@ TK 16) 2.79 3.87 4.41 11.07

/ 85% of each year sales would be on credit; average price at TCCA assumed to be TK 1450. Down2/ payment of 10%.- 85% of sales on credit. Down payment of 10%.- Repayable in equal annual installments at 13% interest,

- 84 -

ANNEX 7BANGLADESH Table 2

HAND TUBEWELLS PROJECT

Seasonal Flow of Funds-

Year 1 Year 2Model I Nov.-March April-Oct. Nov.-March April-Oct.

Outflow: 2,863 917 1,128 917Inflow: - 2,056 2,312 2,313HTW Loan Receipt 1,494 - - _Debt Service - - 633 -

Net Inflow -1,369 1,139 551 1 396

Model II

Outflow: 2,359 975 979 975Inflow: - 2,230 2,477 2,509HTW Loan Receipt 1,188 - - -Debt Service - - 503 _

Net Inflow -1,171 1,255 995 1,534

Model III

Outflow: 2,498 917 1,118 917Inflow: - 1,845 2,050 2,076HTW Loan Receipt 1,188 - - -Debt Service - - 503 -

Net Inflow -1,310 928 429 1,159

Model IV

Outflow: 2,075 608 695 608Inflow: - 1,564 1,369 1,759HTW Loan Receipt 1,188 - - -Debt Service - - 503 -

Net Inflow -887 956 171 1,151

1/ For all practical purposes, the growing season can be divided intotwo distinct parts; Aus and Aman crops are grown from March/Aprilthrough October, and the other crops from November through March.

November 18, 1980.

- 35 -

ANNEX 7Table 3

BANGLADESH

HAND TUBEWELLS PROJECT

Credit Operations

Medium Term Interest Rate Structure

IRDPCurrent 1/ Proposed 2/

BB to Sonali 2 6

Sonali to TCCA 5 1/2 7 1/2

TCCA Margin + 3 + 3

TCCA to KSS 8 1/2 10 1/2

KSS Margin +1 + 1

KSS Loan Commission 1 1/2 1

Bad Debt at KSS +2 1 1/2

KSSto Members 13 14

1/ As applicable under the IDA assisted RD I and STW projects andthe UNICEF assisted HTW project which were the only MT creditprograms in IRDP until 1980.

2/ As proposed under recently appraised IDA assisted AgriculturalCredit Project.

April 6, 1981.

- 86 -

BANGLADESH ANNEX 8

HAND TUBEWELLS PROJECTS

WORKING PAPERS

1 Groundwater Conditions2 Water Lifting

Documents in Project File

Survey on Maintenance and Condition of Public/Government handpumpTubewells in Rural Bangladesh: May 1970Small Scale Irrigation - I Project US Aid Project No. 388-0019:June 1980Audit of the MOSTI Account - IRDP: June 1980UNDP Project Document: Laboratory Testing of Rural Water SupplyHand Pumps: Undated.-UNICF - Hand Tubewells for Irrigation Purposes: February 1975Planning Commission, Bangladesh Minutes of Review Meeting onProgress of Implementation of Hand Tubewells Project: November1979Choice of Ground Water Irrigation Technology in Bangladesh-L.M. Hannah, The Bangladesh Development Studies, IV October1976Hand Pump Irrigation in Bangladesh: A Comment by M.A.S. Mandal.The Bangladesh Development Studies VI, 1978.Handpump Tubewells for Irrigation Purposes: Current Developmentsand Recommended Actions; UNICEF Dacca, February 1975-Training Manual for Hana Pump Caretakers - (in Bengali)Manually Operated Shallow Tubewells for Irrigation (MOSTI). Dis-tribution Procedure: IRDP in Cooperation with UNICEFFinal Report on the Utilization/ Evaluation of an AID Hand-OperatedWater Pump: Project A-1894 Contract-document AID/ta-c-1354-Georgia Institute of Technology, 1979.Field Report on Irrigation by Hand Tubewells: Nizam U. Ahmed,USAID Dacca, 1975Proposed Plan of Action for the Maintenance of Rural Water Supplyand Sanitation System in Bangladesh - September 1978Proposed Subsidiary Plan of Action for the Maintenance of RuralHandpump Tubewells in Bangladesh: September 1978DPHE Data and Documents for MOSTI II Project (Including proformatender documents, specifications for handpumps, strainers andpipes, proforma carriage contracts and training schedules).Project Digest on Manually Operated Hand Tube Wells for Irrigation(MOSTI) - 2nd Phase: Planning Division, IRDP, August 1980

-I ~~~~~~~~~~~~~~~BANGLADESH

A~~-'~~_ [2¾~~~ MAJOR HYDROLOGICAL REGIONS ANDMAXIMUM DEPTH OF GROUNDWATER

4,'~~i -ii H,,IH,,OOnOIOOOr ~ ~ ~ ~ ~ ~~~-yd-lbnO- Re

0r-r RB.-rd,

Doe - M ooN,, DnpE,rrF GrnonTw IreA2

Oor.r -~~~~~reTn'OnonR~IL nor'S. Proow,erp o Ao'rrownss. ~npvRnOrnR0nOPR~"RO&OOLE Deep-rPrrn-A-e

a A~~~~~~~~~~~~~~-

'N Ns..., rAER Ooo5RLOOROU2Roe2 rrw' Oe nos rOHOO eono o L4He,rZ,grer~ ene oe

~~ Rensrr, $0 rjEnOer)o njoorJe - ""now Sorodor ee~~~~~~IN Fj

RReO.~. nr'R IenO e NOTOEO weoso OSI

K0o., , -~ ' BeN',OrEROL0IJO nET F non,S rrr nodore

N . 'D ''" '' oOourRNRH R000 . nen,oo oro,e

t r~~~rnrtB~~ - Per ON N 0 non. 000

eNO err So ~ ~ ~ ~ ~ ~ ~ ~ ~ r

I A ~ ~ ~ r ee i

'5 '0.'~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~~~~~~B