Document ofThe World Bank

FOR OFFICIAL USE ONLY

Report No: 20970

IMPLEMENTATION COMPLETION REPORT(23280)

ONA

CREDIT

IN THE AMOUNT OF SDR 88.9 MILLION

TO THE

GOVERNMENT OF INDIA

FOR

MAHARASHTRA FORESTRY PROJECT

SEPTEMBER 28, 2000

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

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CURRENCY EQUIVALENTS

(Exchange Rate Effective )

Currency Unit = India Rupee (Rs.)Rs. 1 = US$ 0.38

US$ I = Rs. 26 (1992)= Rs. 43 (2000)

FISCAL YEARApril 1 March 31

ABBREVIATIONS AND ACRONYMS

CAS Country Assistance StrategyERR Economic Rate of ReturnFD Forest DepartmentFDCM Forest Development Corporation of Maharashtra Ltd.FP Forest Production modelGIS Geographic Information SystemGOI Government of IndiaGOM Government of MaharashtraHRD Human Resource DevelopmentICR Implementation Completion ReportJFM Joint Forest ManagementMAI Mean Annual IncrementMFD Maharashtra Forest DepartmentFDCM Forest Development Corporation of MaharashtraNGO Non-Governmental OrganizationMIS Management Information SystemMTR Mid-Term Review OrganizationNTFP Non-Timber Forest ProductPA Protected AreaQAG Quality Assurance Group (World Bank)RDF Rehabilitation of Degraded ForestSAR Staff Appraisal ReportSFD Social Forestry DirectorateTM Treatment ModelVED Village Eco-Development

Vice President: Mieko NishimizuCountry Manager/Director: Edwin R Lim

Sector Manager/Director: Ridwan AliTask Team Leader/Task Manager: Irshad A. Khan

FOR OFFICIAL USE ONLY

DRAFT CONFIDENTIALFOR OFFICIAL USE ONLY

CONTENTS

Page No.1. Project Data 12. Principal Performance Ratings 13. Assessment of Development Objective and Design, and of Quality at Entry 14. Achievement of Objective and Outputs 45. Major Factors Affecting implementation and Outcome 96. Sustainability 107. Bank and Borrower Performance 118. Lessons Leamed 129. Partner Comments 1310. Additional Information 15Annex 1. Key Performance Indicators/Log Frame Matrix 16Annex 2. Project Costs and Financing 18Annex 3. Economic Costs and Benefits 21Annex 4. Bank Inputs 22Annex 5. Ratings for Achievement of Objectives/Outputs of Components 24Annex 6. Ratings of Bank and Borrower Performance 25Annex 7. List of Supporting Documents 26

This document has a restricted distribution and may be used by recipients only in theperformance of their official duties. Its contents may not be otherwise disclosed withoutWorld Bank authorization.

Project ID: P010390 Project Name: MAHARASHTRA FORESTRYTeam Leader: Irshad A. Khan TL Unit: SASRDICR Type: Core ICR Report Date: September 28, 2000

1. Project Data

Name: MAHARASHTRA FORESTRY L/C/TF Number: 23280Country,Department: INDIA Region: South Asia Regional

OfficeSector/subsector: AL - Livestock; AT - Forestry; AY - Other

Agriculture; VM - Natural Resources Management

KEY DATESOriginal Revised/Actual

PCD: 12/08/89 Effective: 05/18/92 05/18/92Appraisal: 06/04/91 MTR: 03/31/95 01/25/96Approval: 01/14/92 Closing: 09/30/98 03/31/2000

Borrower/lImplementing Agency: GOVERNMENT OF INDIA/GOVERNMENT OF MAHARASHTRA STATEOther Partners:

STAFF Current At AppraisalVice President: Mieko Nishimizu Joseph WoodCountry Manager: Edwin Lim Heinz VerginSector Manager: Ridwan Ali Jan Weetjens WijnandTeam Leader at ICR: Irshad A. Khan Bernard Van de PollICR Primary Author: Ian Hill; Kariyan Mei; Animesh

Shukla and Irshad A. Khan

2. Principal Performance Ratings

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=HighlyUnlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible)

Outcome: S

Sustainability: L

Institutional Development Impact: SU

Bank Performance: S

Borrower Performance: S

QAG (if available) ICRQuality at Entry: U U

Project at Risk at Any Time: YesQAG rating oj'July 1999

3. Assessment of Development Objective and Design, and of Quality at Entry

3.1 Original Objective:

3.1.1. The major objectives were:

a) To slow down environmental degradation;

b) To maintain and improve biodiversity conservation;c) To increase the productivity of forest lands;d) To develop wastelands;e) To raise biomass self-sufficiency;f) To generate rural incomes and improve equity through increased community participation.

In support of these objectives and to increase the effectiveness of project investments, the projectalso aimed to introduce fundamental institutional, technical and policy changes in the management of thesector.

3.1.2. The project was innovative in attempting to improve the performance of the forest sector as awhole, rather than focusing on a sub-sector such as social forestry, as in earlier Bank funded projects.Project objectives framed within this sectoral approach were consistent with the Bank's Countty AssistanceStrategy and national and state government priorities. However, some of the objectives were stated verybroadly and the consequent lack of specificity has meant that there has been some difficulty in linking goalsto strategies and programs. Defining the objectives in a well-structured log-frame would have improvedclarity. In addition, the sector-wide approach was translated into eleven sub-components withimplementation difficulties compounded by complex institutional arrangements.

3.2 Revised Objective.

3.2.1 At the time of the Mid-Term Review (MTR) overall project objectives were maintained but thescope of the project was reduced and the objectives better articulated as follows:

a) Increase productivity on forest and wastelands;b) Increase community participation to improve rural incomes and equity, and raise biomass

self-sufficiency;c) Conserve biodiversity;d) Improve sector management

Slowing environmental degradation remained an implicit overarching objective.

3.3 Original Components:

3.3.1 The project had two major components, each sub-divided into important sub-components asfollows:

A. Land Treatment

- Plantation Development providing investment for the treatmnent of about 360,000 ha of degradedpublic forests and wastelands and 9,000 ha of private lands through: a) production forestry andenrichment plantings; b) rehabilitation of degraded forest; c) wastelands afforestation; and d)pasture development

- Village Eco-development (VED) and Tribal Development providing assistance to selected villagesto draw up and implement micro-plans for the rehabilitation of degraded village common andsurrounding lands through afforestation, fodder development, and soil and moisture conservation,supported by related community works. In tribal areas the focus was on joint management ofdegraded forests. All programs in this sub-component emphasized the participation of local people

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and NGOs.

- Biodiversity Conservation and Protected Areas Management providing assistance to develop anintegrated strategy to enhance the conservation and management of protected areas in Maharashtra,rationalizing the existing Protected Area (PA) network, updating management plans of existingareas and developing plans for new areas.

B. Technology and Project Institutional Support

Technology Improvements upgrading the quality of planting material through establishment of: a) aseed production unit responsible for collection, treatment and storage of seeds; b) a nursery unit forthe development and management of modem nurseries; and c) a pasture research unit for pastureseed collection and pasture establishment.

Project Institutional Support including restructuring of the forest administration.

- Development of specialized support services including extension, research, training, strategicplanning, personnel management, resource monitoring, and marketing intelligence capabilities.

3.3.2 The project structure was closely related to the achievement of the project development objectiveswith individual sub-components contributing to specific project objectives. The lessons learnt during earlierBank lending for the forest sector in India were considered in project preparation. The most important ofthese were (a) the need to move from a narrow sub-sector approach (focusing on social forestry) to a morecomprehensive sector-wide approach including all aspects outlined above and (b) to involve conmmunitiesmore actively and directly in the management of forest resources.

3.4 Revised Components:

3.4.1 The project was restructured and a number of changes were made to project components at thetime of Mid-Tenn Review (January 1996). The target for land to be treated under the project was reducedby about 30 percent and wasteland afforestation was canceled, principally because of poor survival ratesand a slow pace of implementation prior to MTR. .Flexibility was introduced in land treatment models toallow for site specific adaptation, and accommodate local community preferences.

3.4.2 Participatory mechanisms were strengthened and a component was added to introduce Joint ForestManagement in 200 villages. To support this initiative a two-pronged training strategy was developed. AllMFD field staff were to be trained in participatory approaches with senior officers participating in trainingof local staff. This was particularly important because it provided an opportunity for officers to translatepolicy into operational guidance and to clarify any issues that arose. The second important modificationwas the introduction of "heterogeneous" training with FD staff and local community members receivingtraining together. This approach proved effective in raising issues and identifying solutions for bothcommunity members and MFD field staff.

3.5 Quality at Entry:

3.5.1 Unsatisfactory. The project design was innovative in attempting to address the forest sector in anintegrated manner. It was also consistent with the Country Assistance Strategy (CAS) objective ofincreasing efficiency in the public sector. The main risks to the project were correctly identified, but thedesign did not take into account the borrower's ability to effectively manage rates of seedling survival and

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achieve the anticipated productivity and financial gains.

3.5.2 Physical targets and productivity assumptions were overly ambitious and critically dependent onsequenced activities (e.g. delays in producing improved planting material and slow progress toward gainingcommunity support for plantation protection severely undercut expected productivity gains). Given the factthat nearly 75% of the total project cost was directed to achieving physical planting targets, unrealisticproductivity projections undermined the financial viability of this component and the project as a whole(see para 4.3). This was a pivotal design error.

3.5.3 The project was also based on unrealistic expectations of the pace of reform. Dated covenants didnot adequately take into consideration the time required to build consensus to introduce significantinstitutional and technical reforms. The pace of reform was further delayed by complex institutionalarrangements as reforms had to be implemented independently by two separate Ministries and aCorporation. Physical distance and indirect reporting arrangements also played a role. For example, theProject Coordination Unit was located at Pune, remote from the Maharashtra Forest Depeartment (MFD)and the Forest Development Corporation of Maharashtra (FDCM), and reported directly to the Secretary,Revenue and Forest Department in Mumbai.

3.5.4 Project design was also flawed by over-dependence on consultant inputs as a precursor to initiatingproject activities. This was exacerbated by the initial weak government commitment to implementing theparticipatory approaches at the field level and to institutional and technical reforms. A QAG supervisionassessment made in July 1999 found project Quality at Entry deficient, but commented that the post MTRdesign was sound as it reduced the project to a more manageable size and increased the focus oncommunity participation.

4. Achievement of Objective and Outputs

4.1 Outcome/achievement of objective.

4.1.1 Satisfactory. The project achieved several of its development objectives, particularly those relatingto slowing environmental degradation, institutional development, increasing community participation inforest management and biodiversity conservation. Consequently, the overall project outcome can beassessed as satisfactory. Although performance in the early years of the project was unsatisfactory, therewas a significant improvement in program management and a greater commitment on the part of both theGovernment and the implementing agencies during the later half of the project period. The project hascontributed to the overall objective of slowing environmental degradation, through the establishment ofsignificant areas of plantations, the rehabilitation of degraded forests and the establishment of vegetativecover on waste and community lands. Other achievements are discussed below in relation to the fourrevised development objectives noted in para 3.2. Key outcome indicators are summarized in Annex 1. Themajor project impacts have been:

(1) Adoption of modem technology for nurseries and seed handling resulting in improved plantingmaterial for land treatment. The technology has had and most likely will continue to have a positiveimpact on forest productivity.

(2) Introduction of participatory forest management involving local communities in rehabilitationand development of degraded community and forest land.

(3) Biodiversity conservation arrangements were consolidated by organizing a separate wildlife

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wing with the necessary planning skills and infrastructure for protected area management.

(4) Fundamental change in the approach of the Forest Department shifting from command andcontrol to a participatory management of forests involving communities in all aspects fromplanning and implementation to revenue sharing. The Human Resources Development activitieswere designed to effectively facilitate the change process and improve capacity of public forestryand community institutions.

Specific Objectives:

4.1.2 Increased Productivity on Forest and Wasteland (DO1). Unsatisfactory. While area-based physicaltargets for plantation development were achieved following their downward revision at MTR, plantationproductivity increases were much lower than expected due to a variety of factors including; rigid treatmentmodels, inappropriate site selection, limited availability of improved planting material, and a limitedinvolvement of communities in protection. This combination of factors resulted in low survival rates inmany areas. While some of these issues were effectively addressed during implementation (mainly bycreating more flexible treatment models and incorporating community preferences in planting materialselection) the net impact of this component was disappointing as both survival and productivity remainwell below expected levels, and an ex-post analysis (see para 4.3) shows that the plantation program as awhole yielded an ERR of 6.9%.

4.1.3 The establishment of pastures was satisfactory, although restricted partly due to delays in theconsultancy to develop technical fodder growing packages and the strategy for pasture development. Therewere also delays in setting up the Pasture Development Unit and a lack of appropriate specialization withinthe MFD. Despite these delays, trial and demonstration plots were ultimately established satisfactorily bythe MFD.

4.1.4 The improvement of planting material was satisfactorily achieved, although with some delaysbecause of slow consultant recruitment. Improved planting material has contributed to increasedproductivity during the project period but not to the extent envisioned. Seed and nursery facilities wereunable to fully meet the demand for quality seeds for the entire state and at the end of the project periodimproved nurseries provided only about 25% of the current demand for seedlings. Nevertheless, capacityfor seed collection, handling, storage, and certification was achieved and is likely to be sustainable. Inaddition, the improved nursery facilities established during the project have had a significant demonstrationimpact. MTR targets in this area were met and exceeded - against a target of 6 modem nurseries, 13 wereactually established and against a target for one seed unit two were established.

4.1.5 The development of a research strategy was delayed until 1997 due to delays in consultantrecruitrnent. Following review by the MFD in the light of national priorities developed by Indian Council ofForestry Research ad Education (ICFRE), a prioritized action plan was completed in 1999 which providesa basis for future research that will contribute to increased productivity. Institutional recommendationswere not acceptable to government due to the large incremental staff requirements.

4.1.6 Improved rural incomes and equity through community participation and raise biomassself-sufficiency (D02). Satisfactory. The Joint Forest Management (JFM) program, introduced at MTR,has contributed significantly to the achievement of this objective. Successful implementation has beenbased on a long-term strategy supported by a Govermment Order setting out the governing legislation andbenefit sharing arrangements. Clearly defined guidelines for field staff and an important HRD trainingprogram provided the necessary institutional support and required skills to change MFD' s approach to

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community participation in forest management. The program has made significant contributions to ruralincomes, in the short-term, through provision of wage employment. More importantly, in the longer-term,improvements in water supply and fodder availability, are leading to changes in cropping patterns andimproved milk production resulting in additional increases in rural income. Benefit sharing, the transfer offorest assets, the establishment of village funds, and the empowernent of community organizations have allcontributed to the development of the rural economy, but to consolidate gains in equity and gender issuesadditional training for MFD staff and JFM committee members is needed. One measure of the success ofthe program is reflected in the growing demand from communities to be included, resulting in a largeincrease in the number of participating villages.

4.1.7 The Village Eco-Development (VED) program was rated satisfactory by the end of the projectperiod, although the initial approach was not well defined and was largely based on earlier social forestryprograms, with implementation mainly undertaken by the Social Forestry Department (SFD). One hundredand fifty five villages were ultimately involved in the program, falling short of the MTR target by 10%.Forty NGOs were also involved in implementation of the VED program., although only 25 of thesecontributed satisfactorily to program implementation. Following mid-term restructuring, a moreparticipatory approach was successfully adopted based on a significant program of training. This hasresulted in many communities participating fully in establishment and protection of forest resources.Unfortunately in many of the earlier VEDs a culture of dependency on SFD remains to be addressed.Program benefits in terms of wage employment, development of community funds, water supply, fodderavailability and improved crop and livestock production are broadly similar to the JFM program. Butassets created under VED are totally transferred to the village community after three years. As of March,2000, assets in 24 villages were completely transferred to VED committees.

4.1.8 Village Eco-Development program was also implemented in areas adjoining Protected Areas as ameans of increasing rural incomes to reduce dependency on PA resources. This program was initiated inonly 55 villages. It has largely failed to achieve its objective. Until MTR program implementation by theWildlife Wing was based on SFD guidelines for non-forested areas. This was found to be inappropriate anda new approach was introduced more closely linked to reducing dependency on the PA resources byproviding biogas and training in income generating activities. The biogas portion of the program wassubsequently discontinued by GOM because it was benefiting only a few individuals and not the wholecommunity. Thus far the income generating initiatives have had little impact.

4.1.9 Improved Biodiversity Conservation. Satisfactory (D03). The strengthening and development ofthe Wildlife Wing of MFD represents a significant institutional achievement. A biodiversity conservationstrategy for the state and management plans / concept papers developed for 14 PAs form the basis forimproved management. Habitat improvement programs were implemented in 24 PAs out of a total of 27 inthe state and a monitoring system has been designed and implemented. A public awareness program basedon 24 information centers has been started and contract research completed. These assessments ofinstitutional and management achievements must, however, be seen as proxies for improved biodiversityconservation, as real enhancement in biodiversity are only evident from medium to long-term systematicmonitoring.

4.1.10 Improved Forest Sector Management (DO4). Satisfactory. Many of the elements of improvingsector management have been satisfactorily achieved despite initial delays. Thus, important policy refornsidentified at appraisal have been completed. A well structured training program has resulted in animportant change in the approach of MFD staff to the participatory management of forest resources. AnHRD strategy and action plan have been developed. The recommendations of the institutional developmentstudy have been considered in depth and action taken on a number of key recommendations, including

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changes in the administrative structure of MFD. The design of a Management Information System (MIS) isalmost complete and necessary hardware is available. A Geographic Information System (GIS) has beensuccessfully developed and is being introduced in a number of Working Plan Divisions. Infrastructureimprovements financed through the project have facilitated implementation. Although importantmanagement issues related to decentralization, target-oriented budgetary planning, and inter-agencyco-ordination remain to be resolved, changes in the management of the sector, linked to importantattitudinal changes have taken place during the project period. The most fundamental of these has been thetraining and skill acquisition that led to a widespread acceptance of JFM as an effective management tool.

4.2 Outputs by components:

4.2.1 Output indicators are presented in Annex 1, linked to project components and developmentobjectives. Appraisal or MTR estimates are compared with actual achievements, or estimates based onMFD monitoring data and implementation experience during the project period.

4.2.2 Plantation Development: Unsatisfactory. Almost 283,000 ha of forest land was planted or treatedduring the project period. This amounts to 120% of MTR targets. Quantitatively this is an acceptable resulthowever quality and financial concems suggest an unsatisfactory outcome in this component. Plantationsurvival rates in some treatment models and on many difficult sites were very low. Due to (a) lack of sitespecific planning, (b) site to treatment mismatch, (c) ineffective protection and aftercare, plantationproductivity was well below optimum levels. Mean Annual Increment (MAI) in the production forestmodels was well below anticipated levels at project closing (see Annex 1, Output Indicators). Failure toassess the economic impact of the decline in productivity on the overall financial viability of this componentwas a major shortcoming of the MTR.

4.2.3 Village Eco-development and Joint Forest Management: Satisfactory. The VED program has beenintroduced in 155 villages from an appraisal target of 170. About 15,941 ha of land has been planted. Over600 communities are participating in the JFM program as compared with a target of 200 set at MTR.Some 26,400 ha of forest land have been treated and a further 182,400 ha are being protected throughJFM. These participatory programs have resulted in improved rural incomes. The widely recognizedsuccess of this component provides important positive reinforcement to the provisional MFD engagementwith communities and increases the likelihood of expansion of these pilot activities in the future.

4.2.4 Biodiversity Conservation and Protected Area Management: Satisfactory. A separate WildlifeWing was created which has been significantly strengthened with staff and other infrastructure, providing afocus for biodiversity conservation. A conservation strategy for the state has been developed, leading to thedevelopment of an Integrated Protected Area System. Management plans have been developed andapproved for 3 PAs and concept papers developed for a further 13. The formal notification procedures for20 of the state's 38 PAs are advanced. A public awareness strategy has been developed and 24 visitorinformation centers established.

4.2.5 Technology Improvement: Satisfactory. Two seed units have been established, 995 ha of seedproduction areas developed, and about 83 tons of quality seed produced. Thirteen nurseries using roottrainers and other improved nursery practices have been established. These have a capacity to meet 25% ofthe current demand for planting material, but on a cumulative basis have met only 7.8% of the need overthe project period. A Pasture Development Unit has also been established and about 4,400 ha of pasturedeveloped.

4.2.6 Project Implementation Support. Satisfactory. There were considerable delays in the recruitment of

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consultants resulting in slow implementation of many project activities and reforms. A well-structuredHuman Resource Development strategy and associated action plan were prepared. Training in principlesand practices of JFM and VED resulted in a significant attitudinal change towards community participationamongst staff at all levels. The contribution of project supported training to this attitudinal change ispotentially one of the most important impacts of the project.

4.3 Net Present Value/Economic rate of return:

4.3.1 The overall impact of the project has been re-evaluated, and the economic rate of return (ERR)re-estimated using the latest information on prices, costs, forest areas, productivity, and other accruedbenefits. Detailed information on these analyses and assumptions made are given in Appendix C. Twoscenarios have been assumed in the re-estimation of the ERR. Scenario 1 includes all quantified benefits,except the benefits from carbon sequestration. Scenario 2 includes, not only the benefits given in Scenario1, but also the benefits from carbon sequestration.

4.3.2 The ERR of Scenario 1 was estimated at 6.9%. The ERR for Scenario 2 is highly dependent on thevalue placed on sequestered carbon. The valuation of such carbon is a controversial issue, and values ofbetween US$5 to US $ 25 per ton have been quoted. To obtain an ERR of 12%, the OCC in India, it mustbe assurned that the value of carbon is about US$17/ton. With a more conservative assumption of the valueof carbon at US $ 10/ton, the ERR is 10%.

4.3.3 The ERRs for individual plantation models have also been recalculated. Those for productionforestry models range from 3% to 10%. For rehabilitation of degraded forest land the ERR ranges fromnegative to 15%, and for wasteland development it is negative. JFM generates the highest ERR of 16.5%while that for VED is 9.9%.

4.3.4 The overall ERR and the ERRs for individual models are significantly lower than those presentedin the SAR, due in large part to over-optimistic assumptions at SAR about forest productivity (see alsoparas 4.1.2 and 4.2.2). The overall ERR was estimated at appraisal as 15.2%. If the ERR is recalculatedusing only the benefits included in the SAR calculations, but with the present revised assumptions aboutproductivity, the overall ERR is 6.5%. As indicated above the ERR of the JFM component is significantlyhigher that the ERR of the project as a whole. This fact has been recognized and incorporated in the designof most of the ongoing forestry projects in India -greater emphasis on support to JFM activities increasesboth the financial viability and poverty targeting (with increased returns in early years from harvesting ofnon-tirnber products with benefits directed to poor, forest-dependent households). This is another importantlesson learned as a result of this project.

4.4 Financial rate of return:

4.4.1 Comparative analysis of various financial models indicates that the JFM model generates thehighest returns. The 209,000 ha forest area transferred to about 600 villages under the JFM program wouldgenerate a total revenue of about US$ 1.4 million per year. Based on 50/50 benefit sharing, thecommunities would receive US$ 700,000 per year, or about US$ 1,200/village per year. This revenueconstitutes an important financial incentive as well as a source of income to rural communities. The aboveestimate does not include forest by-products such as fuelwood and fodder, which are very crucial to rurallivelihoods. During the implementation, the project generated about 78 million person-days of wageemployment, thus providing income to rural communities. Part of this income was deposited in the villagefund for further use in village development as well as a source of rural micro-credit.

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4.5 Institutional development impact:

4.5.1 Satisfactory. The project has had a significant impact on the three main implementing agencies byencouraging a change in approach to the management of forest resources, from command and control toone of partnership with communities. The project-financed consultancy on institutional reform hasstimulated a review of existing arrangements and led to changes in the structure of the MFD. Specializedunits have provided an institutional focus for the introduction of improved technology, MIS, GIS, andmonitoring and evaluation activities, while training programs have helped to create the necessarymanagement and technical competencies. The JFM and VED programs have supported the development ofcommunity organizations for the protection of forest resources. Management of associated village fundshas built community self-reliance and Forest Protection Committees increasingly provide a focus for otherrural development activities. These community organizations are designed to be representative, but genderand equity concems remain.

5. Major Factors Affecting Implementation and Outcome

5.1 Factors outside the control of government or implementing agency:

5.1.1 Unrealistic expectations embedded in the design undermined the borrower's ability to effectively meetearly targets and covenants. Institutional and technological changes came more slowly than designersanticipated. Productivity assumptions were overly ambitious and critically dependent on sequencedactivities. This combination of factors resulted in a much lower ERR than expected.

5.2 Factors generally subject to government control:

5.2.1 Implementing agencies were not given adequate administrative and financial authority and muchdecision-making was highly centralized, resulting in delays in procurement of goods and services, andinadequate control of implementation programs. Difficulties were compounded by frequent changes at theSecretary level and amongst senior staff in MFD and SFD. A lack of commitment to training in the earlypart of the project adversely affected the needed changes in staff attitudes, management skills and technicalcompetencies, and the failure to select and approve individuals for overseas training meant that few staffbenefited from exposure to ideas and practices outside India.

5.3 Factors generally subject to implementing agency control:

5.3.1 Project objectives, programs and procedures were not widely disseminated amongst the staff of theimplementing agencies prior to project effectiveness, leading to delays in implementation. There weredelays in procurement particularly of equipment and consultancy services. The Project Coordination Unitacted as an administrative layer rather than a facilitator and sought to centralize many procurementactivities. Delays in initiating appropriate training programs constrained the introduction of newapproaches and skills required to involve communities in participatory management of forest resources.Forest treatment models developed at appraisal were initially treated as inflexible prescriptions tied tobudgetary norms so that necessary site specific modifications were not introduced. Monitoring focused onthe achievement of targets, rather than on outcomes and had only a limited impact on programmanagement.

5.4 Costs and financing:

5.4.1 Total project costs, including the extension period, are estimated at Rs.4,162 million. Usingyear-by-year exchange rates this represents 96% of the SAR estimate in Rupee terms (Rs.4,3 15 million).

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In dollar terms, the total cost was 79% of the SAR estimate, primarily due to depreciation of the Rupeevis-a-vis the US dollar (SAR estimate of US$141.3 million vs actual costs of US$111.7 million) . TheWorld Bank financed about US$ 94.24 million, or 84% of total project costs.

6. Sustainability

6.1 Rationale for sustainability rating.

6.1.1 Likely. The sustainability of project activities is dependent on the policy environment, humanresources and government commitment to continued funding. Appropriate sectoral policy changes havebeen introduced and these are unlikely to be reversed. Specialized technical skills that have been developedwill remain as a continuing asset and the significant attitudinal shift towards participatory management offorest resources is also likely to be sustained as is evident from Government commitment to expand theJFM program. A well-structured HRD strategy and a strong Change Management Committee provide thebasis for further reforms. GOM commitment to implement the HRD strategy is reflected in the StateBudget for FY 00-01, in which the provision for HRD activities is about Rs.4.0 million. This is consistentwith the requirements of the HRD Action Plan.

6.1.2 Sustainability of other important project activities is also linked to GOM commitment to providingadequate funding for the forest sector as a whole. The MFD Plan Budget approved by GOM for projectand non-project activities during FY 00-01 is about Rs.400 million (US$ 9 rmillion), of which Rs.317million (US$ 7 million) is for continuation of project activities and Rs.83 million (US$ 2 million) fornon-project activities. A further Rs. 105 million will be sought to replace external funding. These budgetaryprovisions will not pennit the plantation program to continue to expand at the current rate, andmaintenance of the plantations and other assets created by MFD under the project are not guaranteed.Project investments in GIS and MIS have generated systems that are widely accepted and utilized for sectormanagement and their upkeep is deemed likely. The sustainability of participatory management programsfor JFM and VED is dependent on the availability of additional GOM funding, or on obtaining funds fromother sources, such as GOI or other state schemes. The core biodiversity conservation program can besustained from GOM funds. It seems likely, therefore, that most MFD activities can and will be sustained.

6.1.3 The sustainability of project activities undertaken by FDCM is more questionable as theCorporation is experiencing severe financial constraints. It is clear that the current plantation programcannot be sustained and it is unlikely that there will be adequate funds for the maintenance of existingplantations. The future viability of the seed and nursery activities is contingent upon FDCM's decision tointroduce pricing consistent with full cost recovery. Consequently, the sustainability of project activitiesundertaken by FDCM is uncertain.

6.1.4 Sustainability can also be considered from an environmental point of view. The project has resultedin significant environmental benefits (see para. 4.6). The increasing emphasis on the participation of peoplein the management of resources increases the likelihood that the enviromnental benefits will be sustained.

6.2 Transition arrangement to regular operations.

6.2.1 GOM had expected that the Bank would respond favorably to a request for a follow-on project,that would build on the successes of this project and further integrate project activities into the regularoperations of the implementing agencies. A proposal for such a follow-on project has been submitted and isunder consideration by the Bank. As noted in para. 6. 1, GOM budgetary provisions allow for continuationof many project activities, including the implementation of JFM and HRD programs. Additional funding to

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expand participatory resource management programs is being sought from GOM and centrally sponsoredGOI schemes.

7. Bank and Borrower Performance

Bank7.1 Lending:

7.1.1 Unsatisfactory. Bank staffing and skill mix at appraisal were adequate and project identificationwas consistent with the Bank and borrower priorities.Appraisal failed to adequately assess the inmmediatecommitment of the borrower to implement vital refonns and also underestimated the capacity of theimplementing agencies to achieve ambitious physical targets. At project negotiations the Bank increased theIDA credit by US$ 20 million to expand the plantation target. In hindsight it is clear that the credit amountwas excessive and the problem was further exacerbated by the depreciation of the rupee vis-a-vis the dollar.About US$16 million were canceled from the credit following MTR and, even though the project wasextended for 18 months, another US$ 13 million was canceled at project closure.

7.1.3 The SAR and project implementation volume did not provide sufficient clarity for the implementingagency with respect to some aspects (JFM) while other aspects were mistakenly interpreted as immutable(treatment models). While the JFM approach was included in the project strategy, there was no componentor financial allocations to support it. Finally, as the ICR guidelines call for evaluating projects according tostandards prevailing at the time of the ICR and not at the time of appraisal, it is worth noting that there isno evidence whether sufficient attention was paid to environmental and social considerations at appraisal.

7.2 Supervision:

7.2.1 Satisfactory. The supervision of the project by the Bank has been regular and included anappropriate skills mix. MTR was extremely important as a range of issues adversely affecting performancewere successfully addressed, although the lack of economic analysis at MTR led to questionable continuedsupport to plantation development. A greater flexibility was maintained in supervision following MTR, andduring the period of project extension. Overall, Bank supervision staff skill mix and continuity wasmaintained. The supervision teams spent adequate time in the field. There were two missions per year - oneminor and one major. Bank managers remained involved and provided guidance to the staff. Except for thelast two years, the project was managed from headquarters with necessary support and back up from thefield office. No deviation from Bank's policies and procedures including the safeguard policies were found.In 1999, QAG assessed project supervision as satisfactory.

7.3 Overall Bank performance:

7.3.1 Satisfactory. Design deficiencies were overcome by appropriate action at MTR and subsequentsupervision. The project has therefore been able to achieve many of its development objectives, so theBank's overall performance can be assessed as satisfactory.

Borrower7.4 Preparation:

7.4.1 Satisfactory. During preparation the MFD agreed to take bold steps to upgrade their technicalcapabilities, to revamp institutional arrangements and to initiate a new partnership with communities in themanagement of forest resources in the state. At appraisal the borrower provided data and collaborated inthe preparation of the project. However, preparation inputs were channeled through a small number of staff

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and discussions of project concepts and activities were not systematically disseminated neither atheadquarters nor to field staff. This narrow base of understanding and support for project objectives led toweak initial ownership and contributed to a lack of consensus amongst those responsible forimplementation at the time of project effectiveness and, hence, to slow start up of project activities.

7.5 Government implementation performance:

7.5.1 Satisfactory. Although there were significant delays, the State Government eventually approvedirnportant policy reforTns, gave support to the institutional reform program, and was fully supportive ofparticipatory forest management.

7.6 Implementing Agency:

7.6.1 Satisfactory. Once the Project Coordination Unit was established plantation activities went aheadrapidly, although models were initially treated as inflexible prescriptions. Performance was adverselyaffected by delays in the recruitment of consultants which delayed improvements to seed and nurseryfacilities. Initially, the approach adopted in the VED program was unsatisfactory. Performance is assessedas satisfactory due to improvements made following MTR.

7.7 Overall Borrower performance:

7.7.1 Satisfactory. Although performance in the early part of the project was unsatisfactory, thesignificant improvement made after MTR means that the overall performnance of the borrower can beassessed as satisfactory.

S. Lessons Learned

8.1 Policy and Institutional Reform. Government commitment to reform programs must beclearly established prior to project effectiveness. A distinction needs to be made between policy andinstitutional reforms. The forrner are purely dependent on government decisions that can be made prior toproject effectiveness. Institutional reforms result from a gradual change in attitudes and processes whichtakes time, so commitment must be evidenced by initiation of the reform process. The project has clearlyshown that effective HRD programs bring about changes in attitude and can provide the driving force forchange management, so early commitment to HRD is essential for reform.

8.2 Community Participation and JFM. Participatory forest management programs should, infuture, receive a higher priority than government plantations. Community involvement in themanagement of forest resources results in improved forest protection and productivity, higher economicreturns, and a significant impact on rural poverty and community development. The benefits from increasedavailability of forest products, particularly fodder, improved ground water recharge, and resulting indirectincreases in agricultural production have been noted. In addition, the development of the Forest ProtectionCommittee at village level under JFM as an effective conmmunity institution empowers villagers,particularly through the management of village funds by the committee, and provides a focus for manyother rural development activities. This contrasts with the marginal economic benefits of plantationsestablished and managed by government agencies. However, improved seed and planting materials, coupledwith sound silvicultural practices, are as important in participatory programs as in government plantations.

8.3 Flexible Project Management. There is a need for flexibility during project implementation sothat forest management practices can be linked to site conditions. During implementation of thisproject, forest treatment models developed at appraisal were treated as rigid prescriptions, linked to targets

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and budgetary norms, adversely affecting performance. To avoid this, field staff must be given authority tovary expenditures on site specific forest treatment, within an overall budget envelope. The JFM programallows this flexibility and the choice of land treatment and tree, fruit or fodder species is made bycommunities. Good supervision complemented by an effective MTR can assist implementing agency tomake the necessary changes.

8.4 The Role of Government. Government has an important role in strategic planning for theforest sector and in the introduction of improved technology. Project implementation experience pointsto the need for strategic planning to assess the suitability of forest land for various types of management,and allocate the land to various management zones accordingly. If plantations are to be established fortimber production, they should be located on the best available forest lands. Elsewhere, it is likely that JFMwill be the most effective system of management, supported by the introduction of improved plantingmaterial and better silvicultural practices to provide increased returns to the participating villagers at shortintervals. The improved technology produced through the successful planting material program increasedthe availability of high quality planting stock. However, project experience shows the need for advanceplanning to link production and demand for these improved planting materials, whether it be for plantationsor participatory programs.

8.5 Impact Evaluation. Monitoring indicators must reflect project outcomes as well as physicaloutputs. A monitoring and evaluation unit was strengthened during the project implementation, but therewas always a focus on physical establishrnent of plantations. Consequently, assessment of projectoutcomes, in particular of project activities involving communities and environmental aspects, was difficultto quantify.

9. Partner Comments

(a) Borrower/implementing agency:

Government of Maharashtra's

Remarks on Imnlementation Completion Report (ICR)

9.1.1 In the Development Objective 1 (DO 1): Increase productivity on Forest and Wasteland(components: plantations development, technological improvement); the achievement is (has been) ratedas unsatisfactory (in ICR).

9.1.2 In this regard this is to point out that the physical targets of plantation development componenthave been evaluated using primarily the parameters of achievements of appraisal targets and productivityestimated at SAR and shown as 78% of the original appraisal targets. In fact reduction of physical targetat MTR were basically decided in consultation with the World Bank and hence so far as target achievementviz. SAR targets are concerned, they were impacted by the decision of reduction of physical targets takenduring MTR making the achievement of SAR targets impossible. Thus the comparison of the achievementof physical targets with SAR targets to rate the achievement of plantation development component is notappropriate. Again, in view of the fact of projected ERRs at the time of project preparation being relativelyhigh and overestimated (as already agreed to by the ICR mission) the productivity estimated at the end ofthe project appears quite obviously as low.

9.1.3 In Appendix A, attachment 2, page 1, the MTR physical targets achieved are as under:

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MTR Targets (Ha) Achievement (Ha)

FDM, FOCM, SFD ) 2,96,789 2,87,103 96.73%FDCM )SFD )

9.1.4 Thus physical targets set for plantation development are satisfactorily achieved, as per MTRtargets.

9.1.5 As has been pointed out by the ICR mission also, the slowing down of environmental degradationwas implicit over arching objective of the project. In view of this one cannot ignore the fact that thecontribution to the increase in productivity of the area under treatment has been not just because of theplanted material but also because of vigorous growth of root stock, improved soil and moistureconservation, and other intangibles like nutrient cycling, carbon sequestration etc. in the area. Theseachievements, it has been specifically mentioned by the ICR mission, resulted from improved technicalmanagement within the implementing agencies despite difficult ecological conditions. Moreover, thetechnology improvement component of this development objective has been rated as satisfactory in para4.3 Point No. 5 of this ICR report itself

9.2. In the Development Obiective 4 (DO4) (Plantation Development) the achievement is (has been)rated as unsatisfactory(in the ICR). In this regard it is again pointed out here also there has been areliance on physical targets at SAR while evaluating the achievements. Considering in the remarks on para4.1.2 of ICR report as pointed out in para 1 above, it is pointed out that the achievements of thiscomponent should also be viewed against the MTR targets since down sizing of the plantation target atMTR simply precluded the possibility of achieving SAR targets. This single parameter should not beconsidered as the sole parameter for evaluating this component. Considering all the above pointsmentioned with reference to the issue at para 4.1.2 also, the achievement of this component may not berated as unsatisfactory but satisfactory.

9.3 Further in annexes the following comments are made:

Annexure 1:

MIS study position is as shown under:

Indicator MTR/Ext. Estimate Actual/Estimate

MIS study complete Complete by 1998 2000: All except 4 modules

MIS functional Functional by 1999 2000: One pilot circle for 7 modules

Annexure 5:

The achievement of gender related objective/output has been rated as unsatisfactory. In thisregard, it is submitted that as against the earlier history of not sensitive environment for genderissues in forestry sector, within the project period itself one finds involvement of women in thedecision making institutions within JFM and VED programmes to the extent of 20 to 25%representation. This position may not be rated as unsatisfactory but satisfactory.

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Annexure 6:

The Borrower performance in the pre MTR period has been rated as unsatisfactory bothregarding performance of the Government as also implementing agency.. Here it is submitted thatthe Maharashtra Forestry Project was the first of its kind in the country and the switching over fromthe normal work mode to the project mode was bound to take sometime. However, the thingsimproved as the project proceeded. Considering the fact that quality of entry has been rated by themission as unsatisfactory, the performance of Government and Implementing agencies in the preMTR period should not be rated as unsatisfactory but quite satisfactory and encouraging.

Appendix C:

Para No. 8: Assumption of incremental benefits of US$ 2 per ha per year is too low.Considering the annual increment in forest at the rate of about 0.6 cubic meters, it should at least beabove US$ 100.

Para No. 16: The phrase 'due to' shall be replaced by 'if there is'.

(b) Cofinanciers:Not applicable

(c) Other partners (NGOs/private sector):Nil

10. Additional Information

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Annex 1. Key Performance Indicators/Log Frame Matrix

Outcome/Impact Indicators

Indicator Appraisal Estimate Actual/Estimate

I. Increased productivity of forest land Variable. Dependent on Plantation MAI increase of 1.0 to 2.06 m3/haproduction model

2. Improved rural incomes and equity Not specified Community funds.through Wage employment

community participation Improved water, fodder, fuelwood availabilityRaised biomass self sufficiency Transfer of assets to community

Increased crop and livestock productivityCommunity institutions developed

3. Improved biodiversity conservation Not specified Increased biodiversityImproved institutional and managementarrangements

4. Improved forest sector management Not specified Policy and institutional reforms, and acceptance ofparticipatory management approach

Output Indicators:

Indicator SAR MTR Actual/Estimate

Increased productivity offorest land:Production forest established (hectares) 165,000 130,822 148,102

Increase in MAI (cum /ha) models* FPI 3.56 1.52* FP2 1.98 0.93* FP3 3.94 1.53* FP4 (tons/ha) 2.76 1.15* FP5 NA 2.12* FP6 NA 2.18* RDFI 1.98 2.19

RDF2 1.03 3.292.03 1.71

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Area degraded forest treated (hectares) 145,000 92,694 121,741Area wasteland afforested (hectares) 37,500 10,590 12,869Area pasture developed (hectares) 10,000 6,743 4,391No. seed units 1 2Ha. Seed production areas (hectares) Not Not specified 995Tons quality seed produced specified Not specified 82.78 to March 99No. improved nurseries established Not 6 13% use of improved planting material specified Not specified Cumulative 7.8% to 1999.

8 Current. 25%

Improving rural incomes, equity and biomass

* 'VED (Villages) 150 170 155* VED/PA (Villages) 60 60 59. JFM (Villages) 0 200 602Increase in rural incomes -. Not specified PositiveImproved water availability _ Not specified PositiveIncrease in fodder and fuelwood production - Not specified PositiveAsset transfer _ Not specified PositiveIncrease in crop production . Not specified Positive

Improving biodiversity conservation

Conservation strategy developed Not specified Completed in 1999Wildlife Wing strengthened Not specified Posts sanctioned 1993-97No. PAs managed by Wildlife Wing 16 38 38No. PA management plans completed 10 18 14 draft plan +13 concept papersNo. VED plans implemented 60 60 59No. visitor centers established 17 24 24

Improving sector management:Sector reform study and action plan completed Complete by 1997 1998No. recommended reforms implemented* Policy Not specified 5* Administrative Not specified 13

HRD strategy and action plan approved Complete by 1999 2000HRD Cell established Established by 1997 1999No. courses/workshops Not specified 425No. persons trained Not specified 20,490

* GIS developed Not specified 1997* No. WP Divisions using GIS Not specified 7* MIS study complete Complete by 1998 2000 - except budget module* MIS functional Functional by 1999 2000 - one pilot circle

Infrastructure* No. of buildings completed 1828 1763* % goods & equipment procured. 100 99

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Annex 2. Project Costs and Financing

Project Costs by Components (in US$ milhon equivalent)

Project Component Appraisal Estimate Actual/Latest Estimatel/ Percentage of(US$ million) (US$ million) Appraisal

A. Land Treatment

1. Plantation Development 87.70 67.05 76

2. Eco and Tribal Development 8.00 14.02 175

3. Biodiversity Conservation 7.20 7.70 107

Sub-Total 102.90 88.77 86

B. Technology & ProjectImplementation Support

Technology Improvements

1. Seed unit 0.60 0.89 148

2. Nursery unit 1.80 2.46 137

3. Pasture Development unit 0.50 0.65 130

Sub-Total 2.90 4.00 138

Project Implementation Support

1. Project organization 7.70 13.80 179

2. Restructuring Forest Administration 0.30 0.19 63

3. Specialized support services 3.00 4.95 165

Sub-Total 11.00 18.94 172

Total Base Cost 116.80 111.71 96

Physical Contingencies 6.30 0.00 0

Price Contingencies 18.10 0.00 0

Total Project Cost 141.20 111.71 79

1/ Using year-by-year exchange rates: 25.00 (91/92); 27.06 (92/93); 30.71 (93/94); 31.64 (94/95)33.18 (95/96); 35.65 (96/97); 37.55 (97/98); 41.71 (98/99) and 43.18 (99/00).

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Project Costs by Procurement Arrangements (in US$ million equivalent) *

Expenditure Procurement Method Procurement Method

Category App aisal Esfimate Actual/Latest EstimatesICB NCB Other NBF Total ICB NCB Other NBF Total

1. Plantation 0.00 00.0 110.90 0.00 110.90 79.06 79.06Works

2. Civil 0.00 4.60 7.10 0.00 11.70 0.48 12.14 12.62Works3. Goods 2.00 2.50 0.90 0.00 5.40 1.78 5.80 7.584. Services 0.00 0.00 3.40 0.00 3.40 0.21 1.53 1.745. Misc. 0.00 0.00 10.70 0.00 10.70 10.71 10.71

Total 2.00 7.10 133.00 0.00 142.10 1.99 0.48 109.24 0.00 111.71

Project Financing by Component (in US$ million equivalent)

Component Apl Praisal Estimate ActuMl/Latest Estimate Perceg of ApraisalBank Governme Co-financi Bank Governme Co-financi Bank Governme Co-financi

nt er nt er nt er

1. Land Treatment- Plantation Development 95.30 10.60 63.03 2.51 66 24- Eco &tribal 8.70 0.90 13.34 1.36 153 151development- Biodiversity conservation 5.80 2.70 4.66 3.29 80 122Sub-Total 109.80 14.20 81.03 7.17 74 50

B. Technology &ProjectImplementationSupportTechnologyImprovements

I. Seed unit 0.40 0.30 0.63 0.29 158 962. Nursery unit 1.80 0.40 1.87 0.68 104 1693. Pasture 0.50 0.20 0.57 0.11 115 53development unitSub-Total 2.70 0.90 3.07 1.07 114 119Project ImplementationSupport1. Project 7.40 2.10 10.63 3.27 144 156Organization2. Restructuring 0.40 0.00 0.15 0.04 38Forest Administration3. Specialized support 3.10 0.40 3.77 1.50 122 376servicesSub-Total 10.90 2.50 14.56 4.80 134 192

Total Base CostPhysical Contingencies X

Price ContingenciesTotal Project Cost 123.40 17.60 1 98.66 13.04 80 74

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* Note: NBF = Not Bank Financed (includes elements provided under parallel co-financing procedures,consultants under trust funds, any reserved procurement and any other miscellaneous items). Theprocurement arrangements for items listed under "Other" and details of the items listed as NBF need to beexplained in footnote to the table.

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Annex 3: Economic Costs and Benefits

Cost Benefit Analysis

Present value of FlowsEconomnc Analysis Financia Analysis

Appraisal Latest Estimates Appraisal Latest Estimates

ERR%- Whole project 15.2 10.0- FPI model 15.0 9.8

- FP4 model 13.4 10.0

- RDFI model 18.6 14.6- JFM model -- 16.5Area treated (ha) 367,500 330,000 367,500 330,000

MAI (ton/cu.m/ha):- FP1 model 3.93 1.52 3.93 1.52- FP4 model 2.76 1.15 2.76 1.15- RDFI model 4.97 2.64 4.97 2.64- JFM model -- 3.46 -- 3.46Area under JFM protection (ha) -- 209,000 -- 209,000Wage employment 80 78 80 78(person-day/million)Incremental annual income in 1,200JFM villages (US$/village)

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Annex 4. Bank Inputs

(a) Missions:Sta orect ycle No. of Persons and Specialty Performa nce Ratin

(e.g. 2 Economists, I EMS, etc.) Implementation DevelopmentMonth/Year Count _ Specialty Progress Objective

Identification/PreparationJan 90

Appraisal/NegotiationAppraisal June 91

Negotiation Dec 91

SupervisionMarch 1993 5 Foresters(2); Sociologist(l); S S

Wildlife(l) Planner(l)October 1993 2 Foresters(2) S SMay 1994 6 Foresters(2); Sociologist(l); S S

IT(I); Plant tech.(I),Procurement( 1)

December 1994 3 Foresters(2); Sociologist(1) U UJune 1995 7 Forester(l); Agriculturist(l); U U

Sociologist(I); Procurement( 1);Biodiversity(l); IT(l); Planttech.(l)

January 1996 9 Foresters(2); Sociologist(l); S SSocial forestry(l); IT(I); Costabspec.(l); Plant tech.(l);Biodiversity(l); Procurement(l)

November 1996 3 Foresters(2); Sociologist(l) S SJune 1997 7 Foresters(2); Inst.& Policy(l); S S

Biodiversity(l); Procurement(l);Sociologist(l); Social forester(l)

March 1998 5 Foresters(2); Biodiversity(l); S SSocial forest.(l); Plant quality(l)

August 1998 3 Forester(l); Forest mgmt(l); S STeam asst.(l)

February 1999 8 Forester(l); NRM(I); S SBiodiversity(l); IT(I); Forestmgmt(l); Forest tech.(l); Socialfor.(l); Procurement(l)

October 1999 3 Forester(l); NRM(I); Social S Sforest.(l)

ICRApril 2000 6 Forestry spec.(2); Program

assist.(l); FAO-CP team of3 persons

/ U = Unsatisfactory; S = Satisfactory; I = no significant problems; 2 = moderate problems.

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(b) Staff:

i Stage of Project Cycle Actual/Latest EstimateNo. Staff weeks US$ (,000)

Identification/Preparation 137.80 371.70Appraisal/Negotiation 68.10 190.70Supervision 207.14 467.68ICR 8.50 32.00Total 421.54 1062.08

This includes Bank-financed and trust fund consultants

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Annex 5. Ratings for Achievement of Objectives/Outputs of Components

(H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable)

Rating0 Macro policies O H OSUOM O N * NAO Sector Policies O H * SU O M O N O NAO Physical O H * SU O M O N O NAE Financial O H OSUOM O N O NA

I Institutional Development 0 H O SU O M 0 N 0 NAO Environmental * H OSUOM O N O NA

SocialL Poverty Reduction O H *SUOM O N O NAO Gender O H OSU*M O N O NA0 Other (Please specify) O H OSUOM O N * NA

0 Private sector development 0 H O SU O M * N 0 NAO Public sector management 0 H 0 SU 0 M 0 N 0 NA0 Other (Please specify) 0 H O SU O M 0 N 0 NACommunity participation

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Annex 6. Ratings of Bank and Borrower Performance

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)

6.1 Bank performnance Rating

O Lending OHS OS *U OHU0 Supervision OHS Os Ou OHUO Overall OHS OS O U O HU

6.2 Borrowerperformance Rating

O Preparation OHS OS O U O HUO Government implementation performance O HS O S 0 U 0 HUO Implementation agency performance OHS OS O u O HUO Overall OHS OS O U O HU

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Annex 7. List of Supporting Documents

Appendix A: Aide Memoire of FAO-CP tearnAppendix B: Technology Improvement and Treatment ModelsAppendix C: Financial and Economic AnalysisAppendix D: Borrower's Evaluation

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