PCR:INO 19097

ASIAN DEVELOPMENT BANK

PROJECT COMPLETION REPORT

ON THE

THIRD IRRIGATION SECTOR PROJECT(Loan Nos. 860[SF]/861 - INO)

IN

INDONESIA

December 1995

Currency Unit

$1.00Rpl.00

as of March 1995

Rp2,21 0$0000452

ACTIPADFDAADDGFCADGFCHDGPARA

DGTDGWRDDOlEAEIRREOM1SFLCBOCRPBBPCRPCMPGUP1KPluP01PRASPWRSR&USDRSIDSMTDUWUA

CURRENCY EQUIVALENTS

Currency Unit - Rupiah (Rp)

as of June 1987

Rpl 650$0. 000606

The exchange rate of the rupiah is allowed to float under the management of BankIndonesia. In this Report, a rate of $1 .00 = Rp2,1 00 has been used.

ABBREVIATIONS

Agriculture Component for Third Irrigation Sector ProjectAsian Development FundDirectorate of Area DevelopmentDirectorate General of Food Crops and AgricultureDirectorate General of Food Crops and HorticultureDirectorate General of Public Administration and RegionalAuthorizationDirectorate General of TaxDirectorate General of Water Resources DevelopmentDirectorate of IrrigationExecuting AgencyEconomic Internal Rate of ReturnEfficient Operation and MaintenanceIrrigation Service FeeLocal Competitive BiddingOrdinary Capital RersourcesPa/ak Bumi dan Ban gunan ( Land and Building Tax)Project Completion ReportProject Completion MissionProject Guidance UnitProyek Irigasi Kecil (Small Irrigation Project)Project Implementation UnitPlan of ImplementationProvincial Agricultural ServiceProvincial Water Resources ServiceRehabilitation & UpgradingSpecial Drawing RightSurvey, Investigation, and DesignSpecial MaintenanceTertiary Demonstration UnitWater Users' Association

NOTES

(i) The fiscal year (FY) of the Government ends on 31 March.(ii) In this Report, "$" refers to US dollars.

1.

CONTENTS

Page

BASIC DATA

MAP vii

I. PROJECT DESCRIPTION

III

EVALUATION OF IMPLEMENTATION

2

A. Project Components 2

B. Implementation Arrangements 10

C. Project Costs 12

D. Project Schedule 13

E. Engagement of Consultants and Procurement

13of Goods and Services

F. Performance of Consultants and Contractors 15

G. Condition and Covenants 16

H. Disbursements 17

Environmental Impact

17J. Performance of the Borrower and Executing Agencies

17K. Performance of the Bank

18

II'

EVALUATION OF INITIAL PERFORMANCE AND BENEFITS

20

A. Attainment of Benefits

20B. Economic Performance

21

HI

CONCLUSIONS AND RECOMMENDATIONS

22

A. Conclusions

22B. Recommendations

22

APPENDIXES

11

BASIC DATA

A. Loan Identification

1. Country2. Loan Number3. Project Title4. Borrower5. Executing Agency

6. Amount of LoanActual

7, PCR Number

B

Loan Data

1. Appraisal- Date Started- Date Completed

2. Loan Negotiations- Date Started- Date Completed

3. Date of Board Approval

4. Date of Loan Agreement

5. Date of Loan Effectiveness- In Loan Agreement- Actual- Number of Extensions

6. Terminal Date for Commitments- In Loan Agreement- Revised- Actual- Number of Extensions

7. Closing Date- In Loan Agreement- Revised- Number of Extensions

8. Terms of LoanADF- Service Charge- Maturity- Grace Period

Indonesia860 (SF)/861 -INOThird Irrigation Sector ProjectRepublic of IndonesiaDirectorate General of Water Resources DevelopmentDirectorate General of Food Crops and Horticulture1Directorate of Land and Building Tax2 (PBB)Directorate General of Regional Development

ADF OCR

SDR 46,587,000 $60,000,000

SDR 44,183,079 $56,705,179

PCR:INO 350

8 Jun 19873 Jul 1987

15 Oct 198719 Oct 1987

17 Nov 1987

21 Dec 1987

21 Mar 198819 Feb 1988

None

30 Sep 199330 Sep 199430 Sep 1994One

30 Sep 199330 Sep 1994One

1 percent per annum35 years10 years

Formerly Directorate General of Food Crops and Agriculture (DGFCA).2 Formerly Directorate of Land T.

Time Interval6 years 7 months

Time Interval5 years 7 months

LOAN 861 —INO

Total (B)

Grand Total (A + B)

($)

20,200,000

22,284,000195,000

335.000

6.136,00087,000

57,000

3,036.00070,000

7,600.000

60,000,000

120,000,000

I. 01

II. 02III. 03IV, 04

V(A). 05AV(B). 05B

V(C). 05C

'1(0). 050

VI. 06VII. 07

($)

20,361,180

22,527,264

195,000

335,000

5,993.000230,000

57,0002.631,556

70,000

7,600,000

60,000,000

124,152,361

($)

993,588

1,010,19216,920

221.840

523,75053,23610.995

394,300

70,000

0

3.294,821

6,943,251

($)

19,367,592

21.517,072178,080113.160

5.469.250176,764

46,005

2.237, 256

07.600.000

56,705.179

117,209,110

11].

OCR- Interest Rate- Maturity- Grace Period- Commitment Charge

9. Disbursements

a. Dates

Initial Disbursement7 Oct 1988

Effective Date19 Feb 1988

variable25 years5 years0.75 percent per annum

Final Disbursement23 May 1995

Original Closing Date30 Sep 1993

b. Amount ($)Original B e v s a d Last Revised Amount Undlsbursed

Category Allocation Category Allocation Allocation Disbursed BalanceSDR • SOB $ Equivalent SOB $ Equivalent SOB $ Equivalent SDR $ Equivalent

LOAN 860(SF)—INO

I. 8225,000 I. 01 8,225,000 10,593,084 9,464700 12,925.730 9420,688 12,858,934 44,012 66.796II. 1.459,000 II. 02 1,459,000 1,879,065 1,258,700 1,796,663 1,026,180 1,443,767 232,520 352,896

111(A). 9,056,000 111(A). 03A 9,056,000 11,663,340 10,987,000 15,019,559 10,645,176 14,500,773 341,824 518,786

111(B). 1,453,000 111(9). 03B 1,453.000 1.871,337 1.258,700 1,797,250 1,026,113 1,444,252 232.587 352.998IV. 536,000 '1(A). 04 536,000 690,321 809.500 1,114,394 778.726 1,057,688 30,774 46.706V. 1,388,000 V(A). 05 1,299,400 1.673,514 1,458,600 2,010.303 1,349,358 1,844,507 109,242 165,796

VI 5,869.000 Vl(A). 06 5,294,000 6.818.211 5,601.000 7,531,408 5,852,738 7,913.471 (251,738) (382.063)

VII. 93,000 VII. 07 93,000 119.776 93,000 130,709 89,979 126,124 3.021 4.585

VIlI(A). 1,007.000 VIlI(A). 08A 974.000 1,254,427 1,320.000 1,817,359 1.270.450 1,742,158 49.550 75.201

Vlll(B), 757.000 VIIl(C). 089 757.000 974,950 2,493,900 3,464.567 2,278,062 3,136,990 215.838 327.577

VllI(C). 896.000 VIII(0). 08C 896.000 1.153,970 281.100 423,829 62,072 91,410 219.028 332,419

VIII(D). 10,044,000 VIll(E). 080 9,711,600 12.507,695 6.910.300 9,476,976 6,521,296 8,886,585 389.004 590,391

VIlI(S). 2,184,000 Vlll(F). 08E 2,173.000 2,798.635 370.640 537,410 286.660 409.953 83,980 127,457

Vlll(F), 1,313,000 VIII(H). OaF 1,280,500 1,649,173 1.533,200 2,181,405 1,327,220 1.868.788 205.980 312,617IV(B). 09 12,000 15,455 12,000 17.741 7.898 11,515 4,102 6.226V(B). bA 52,500 67.615 52,500 75,866 43.636 62.413 8,864 13,453V(C). lOB 88.600 114.109 88.600 134,468 0 0 88,600 134.468Vl(B). hA 87,000 112,048 87.000 126,071 84,816 122,757 2,184 3.314VI(C). 119 575,000 740.550 575,000 819,342 477.847 671,893 97,153 147,449VIll(B). 12A 33.000 42.501 33,000 48.811 21,353 31,134 11,647 17,677VIIl(G). 128 72,000 92,730 72,000 106,003 65,879 96,712 6,121 9,291'1111(1). 12C 32,500 41,857 32.500 49.325 0 0 32,500 49.325'1111(J). 120 11,000 14,157 11,000 16,695 0 0 11,000 16,695VIII(K). 12E 260.400 335,373 310,760 440,541 304.932 431,697 5,828 8.844

IX. 1,065,000 IX. 13 913,500 1,176,508 230,300 349,526 0 0 230,300 349.526X. 1,242,000 X. 14 1.242,000 1,599,588 1,242.000 1,740.410 1.242.000 1.740,410 0 0

Total (A) 46,587,000 46.587,000 60,000,000 46,587,000 64,152,361 44,183,079 60,503,931 2,403,921 3,648.430

F ., 1.,,d,o.nt to th. Loon Agro.n,.nt ot Ii .h,n 1990

Fr i.oan Agr..m.nt

P.r Compute, Aeport

Actual

Local Total

71,721 114,499

3,113 8,645

5,874 6,165

466 1,138

10,447 10,447

0 9,3400

91,622 150,235

Foreign

42,7785,532

291672

0

9,3400

58,613

Apr 1988

Sep 1988Jun 1990

Jan 1990Oct 1988

Nov 1991not available

Jun 1990

iv

10. Local Costs (Bank Financed)- Amount- Percentage of Local Costs- Percentage of Total Costs

C. Project Data

1. Project Cost ($ million)

$63.89 million equivalent7043

(a) Foreign Exchange Cost(b) Local Cost(c) Total Cost

AppraisalEstimate57.50092.500

150.000

Actual58.61391 .622

150.235

2. Financing Plan ($ million)

(a) Borrower Financed(b) Bank Financed(c) Govt of the Netherlands(d) Total

Appraisal Estimate

Foreign Local Total Percent

300 22200 22,500 15

54,000 66,000 120,000 783,200 4,300 7,500 5

57,500 92,500 150,000 100

Actual

Foreign Local Total Percent

0 25,395 25,395 17

53,278 63,889 117,167 78

5,335 2,338 7673 5

58,613 91,622 150,235 100

3. Cost Breakdown by Project Component ($000)

Appraisal Estimate

Foreign Local Total

(a) Irrigation Development 44,200 69,750 113,950(b) Agriculture Development 3,200 5,700 8,900(c) Land Tax Improvement 600 6,550 7,150(d) Irrigation Service Fee (1SF)(e) Taxes 0 10,500 10,500(f) Interest During Construction

1. Bank Loan (OCR and ADF) 9,200 0 9,2002. Government of the Netherlands 300 300

Total 57,500 92,500 150,000

4. Project ScheduleAppraisal Estimate

Actual

(a) Date of Fielding Consultants- Irrigation Development- Agriculture Development- Land Tax Component- 1SF Component

(b) Completion of Engineering Designs- Irrigation Development Apr 1993 Dec 1993

Oct 1988

Jul 1988Oct 1988

Mar 1992Apr 1989

Mar 1993

Mar 1993

Sep 1994Mar 1993

Sep 1994Mar 1993

Aug 1994

Apr 1988

May 1988Apr 1990

Feb 1991Oct 1988

Sep 1988Oct 1988

Apr 1989Apr 1993

Sep 1994Oct 1988

Jun 1990

V

(C) Civil Works Contract

First Award- Irrigation Development- Agriculture Development- Land Tax Development

Completion of Work- Irrigation Development- Agriculture Development- Land Tax Component

(d) Start of Operations- Irrigation Development

Institutional- Rehabiliation and Upgrading- Operation and Maintenance- Agriculture Development- Land Tax Component- 1SF Component

Project Engineer (L)

Project Engineer (L)

Technical Assistant

Project Engineer (L)Technical Assistant

Prolect Engineer

Project ImplementationOfficer (L)

Staff Consultant!Irrigation Engineer

Senior Project Imple-mentation Officer (L)

Project Officer/LoanAdministration

Senior Project Imple-mentation Officer (L)

Project Officer/ProjectEngineer

Project Officer/LoanAdministration

Staff Consultant!Agriculturist

17 Project Engineer

2

14 Project Engineer (L)Technical Assistant

vi

D. Data on Bank Missions

Name of Mission Date No. of No. of Per-Persons son-days

Inception Mission 6 Apr - 24 Apr 1988 2 38

Review Mission 27 Sep - 29 Sep 1988

83 Oct -6 Oct 1988

10 Oct 1988

Review Mission 21 Jun - 8 July 1989

Review Mission 3 Jul 19895 Jul -9 Jul 1989

7 Nov - 14 Nov 1990

Review Mission 30 Nov 1990

Review Mission 20 May - 1 Jun 1991

1411 Jun 1991

Special Loan Administration 26 May - 1 Jun 1991

7Mission

Review Mission 15 Sep - 6 Oct 1992

2215 Sep - 30 Sep 1992

16

Special Loan Administration 1 Mar - 2 Mar 1993

2Mission

Review Mission 4 Aug - 24 Aug 1993

21

7 Sep - 27 Sep 1993

21

PCR 115 Jun - 29 Jun 1994

15

27 Jun - 29 Jun 1994

2

27 Mar - 13 Apr 1995

16

27 Mar - 7 Apr 1995

12

1 Apr - 13 Apr 1995

10

23 Mar - 23 Apr 1995

30

Total

20

266

Noted: (L) = Mission Leader

Specializationof Members

Sr. Project Engineer (L)Staff Consultant/Training

Specialist

Project Engineer

This Report was prepared by a Bank Mission composed of W. H. Vochteloo (Sr. Project ImplementationOfficer, IRM/Mission Leader); P.P. Wardani (Project Officer, IRM); L. Boenawan Sondjaja (Project Officer,RM); and A.W. Ruscoe (Staff Consultant/Agriculturist). The Mission inspected the Project from 27 March

to 13 April 1995.

JAKARTA

JAVA

TELUK LADA SUBPROJECT

Bali

110°E

-10

130°E

INDONESIA

THIRD IRRIGATION SECTOR PROJECTPROJECT LOCATIONS

BandaAceh

-5°N / 5°141

C

td,osuMAiI

/ MALUKU

o°-I

KALIMANTAN SULAWESI

SUMATRA1'

\-..:

mbon - IRIAN JAVA

1 00S

I0 200 400 600 800

Kilometers

Project Area

• Capital City

o Provincial Capital

- - - Provincial Boundary

• - -. International Boundary

(Boundaries not necessarily authoritative)

—s

viiiMap 2

98°EP. We

F. Breueh INDONESIA

THIRD IRRIGATION SECTOR PROJECT

BANDAACEt4 Project Location, Aceh(as completed)

Sigil

EH'.

-,

h- 5°NPEE - - - NORTH ACEH

5°N

- - -Peureulak

Calang / Takengon - EAST ACEN

WESTAEI1 ftiM EN IRA ACEHLangsa

- - Kualasimpang

Meulabon

Blong Kejaren-.

.,l, /

SOUTHEAST ACEH/

\ NORTH SUMATRAPROVINCE

IGunungPudtir,g

•Paya Dapu

3°N

Bakongan

\.Simeulue

SOUTH ACEK

25 50 75 100 Sing

KilometersBanyak

Project Area

• Rehabilitation and Upgrading Subproject Bengkaru

• Provincial Capital

Lassia

O Major TownBabi

Road

River

District Boundary

• - - -. - Provincial Boundary

(Boundaries not necessarily authoritative)

96°E

95-1776b R

3°N -I

Gunungsitoli

I-1°N

WEST SUMATRAPnl PROVINCE

ix Map 3

98°E

I INDONESIA

THIRD IRRIGATION SECTOR PROJECTProject Location, North Sumatra

-- Belaw(as completed)

( GentingACEH PROVINCE

- - - - :- -. - c,,nga,balal

//1iç*

iriji B

uprabat

P Mursala•

SOUTH TANUU

mngldeuan- :

Pi -

1°N

0 25 50 75 100

Kilometers

• Rehabilitation and Upgrading Subproject

Project Area

. Provincial Capital

o Major Town

Road

River

District Boundary

• - - - Provincial Boundary

(Boundaries not necessarily authoritative)

Tanah Masa

Tanah Bala

96°E

95-1776 R

/

II

/ Ternat

NORTH SIJLAWESI •1

PROVINCE // Bacui

/

/

I

\.

-S.-'

/-5-

// ( Kai Besar Kola

Vamdena

Wetaricl

Maikoor

Trangan/

I/

/

INDONESIA.THIRD IRRIGATION SECTOR PROJECT

IAHERA Project Locations Maluku(as completed)

125°EMorotai 135°E

/I

.-s.

- BURU AmbonLwayiata

---Kilometers

Project Area I - - -• Rehabilitation and Upgrading Subproject -

• Provincial Capital

o Major Town\

- Road

River

District Boundary Welar• - Provincial Boundary

(Boundaries not necessarily authoritative)

IRIAN JAVAPROVINCE

5°S-

I. PROJECT DESCRIPTION

1. In late 1986, the Government of Indonesia requested Bank financing for rehabilitation andupgrading (R&U) and improvement of operation and maintenance (O&M) of irrigation schemesin the provinces of Aceh, North Sumatra, and Maluku. Feasibility studies for 11 sample R&Uschemes covering a total area of 6,900 ha were completed in January 1987 under the Bank-financed Second Irrigation Sector Loan. 1 The policy aspects of O&M, including cost recoveryissues, were examined under a small-scale advisory technical assistance2, which was completedin April 1987. Project appraisal was done from 8 June to 3 July 1987. Its main feature was theformulation of an integrated agriculture development project, with major emphasis on the im-provement of irrigation infrastructure and agricultural support services. In view of the largenumber of subprojects, their wide geographical spread, and the adequate implementationcapacity of the leading executing agency, the Directorate General of Water ResourcesDevelopment (DGWRD), the Project was formulated as a sector loan.

2. The Project was envisaged as a first five-year phase of an eight-year investment program.A second four-year phase would follow with a one-year overlap between the two phases. Themain objective of the Project was to accelerate agricultural development, through improvementof existing irrigation infrastructure and optimization of its use. In addition, the Project wouldsupport the implementation of the Government's irrigation policy on O&M cost recovery. At fulldevelopment, cropping intensities were expected to increase from an average of 130 percent atappraisal to 185 percent for R&U schemes and from 165 percent to 185 percent for specialmaintenance (SM) subprojects. Yield levels of paddy were expected to reach an average of 4.5tons(t)/hectare(ha), from an estimated 2.5 t/ha for R&U schemes and 4.0 t/ha for SM schemesat appraisal. Incremental annual food grain production as a result of the combined impact ofR&U, SM, and efficient O&M was estimated to reach 260,000 t by the year 2000. Theincremental land tax revenues as a result of a reclassification of the irrigable land located in thesubprojects was not quantified at appraisal.

3. The rationale for the Project was the Government's policy under Repelita IV (1 984/85 -1988/89) to enhance the use and performance of existing irrigation systems outside Java toachieve balanced regional development. The Project included

(i) R&U of about 70 small-size and medium-size irrigation systems, covering anaggregate area of about 33,000 ha; and SM works in about 24 irrigationschemes, covering a total of 30,000 ha;

(ii) introduction of efficient O&M (EOM) on about 113,000 ha;(iii) provision of improved agricultural support services;(iv) institutional building of provincial, district, and subdistrict irrigation and

agricultural staff and Water Users Associations (WUAs); including the provisionof consulting services and local and overseas training;

(v) support in the implementation of the Government's policy on O&M cost recoverythrough the handing over of small irrigation schemes (P1K), collection of irrigationservice fees (1SF), and reclassification of the land tax basis in irrigated areas; and

(vi) R&U of the Teluk Lada irrigation subproject (7,500 ha) in West Java Province.3

Loan No. 638-lNO, for $85.0 million, approved on 22 September 1983.

2 TA No. 836-INO: O&M Improvement, for $75,000 million, approved on 26 December 1986.

The construction of this project was financed under Loan No. 243-INO, for $12.2 million, approved in November1975. The loan was closed in July 1986. The Project Completion Report of October 1986 revealed the need for majorrehabilitation as a result of (i) inadequate design and construction quality, (ii) poor project management, and (iii) lackof maintenance of completed contract packages.

2

II. EVALUATION OF IMPLEMENTATION

A. Project Components

1. Irrigation Development

4. A comparison of the activities envisaged at appraisal with those actually executed issummarized in Table 1.

Table 1: Coverage of Irrigation Development Activities (ha)(Appraisal and Actual)

North Sumatra Aceh Maluku Teluk Lada TotalActivity

Appraisal Actual Appraisal Actual Appraisal Actual Appraisal Actual Appraisal Actual

R&U 15000 17420 13000 11,333 5.000 4,812 7,500 7,334 40,500 40,899SM 18,000 5,484 12,000 0 -- -- -- -- 30,000 5,484

EOM 86,000 68,517 23,000 22,185 4,000 4,812 -- -- 113,000 95,514P1K 29,000 8,900 4,000 2,500 2.000 -- -- -- 35.000 11 ,4001SF 8,000 13,305b -- -- -- -- -- 13305b

SIDC 15,000 18,563 17,000 14,047 5,000 6,388 -- -- 37,000 38,998Source: ConsuiEtant's Project Completion Report (PCR), Provincial Water Resource Services (PWRS)

Construction completed, handing over in process during Project Completion Mission.Collection rate about 15 percent of target.Excluding SID for R&U, SM, and P1K schemes.

a. Rehabilitation and Upgrading (R&U)

5. The Project envisaged R&U of about 70 small-size and medium-size irrigation schemescovering an aggregate area of 33,000 ha 1 . The irrigated area of each scheme would varybetween 50 ha and 3,000 ha.

6. R&U construction activities started at the end of 1988 in the sample schemes in Aceh andNorth Sumatra, five in each province. At Project completion in September 1994, 34 schemescovering an aggregate gross irrigable area of 33,565 ha were completed. The actual irrigablearea planted to paddy (productive area), however, is less. In the seven subprojects visited bythe Project Completion Report Mission (PCM) in North Sumatra alone, only 5,460 ha (67 percent)out of a recorded gross irrigable area of 8,100 ha was planted with irrigated rice. The remainingareas were either not developed for paddy land or not planted because of the absence offarmers. A similar situation was encountered at the schemes in Maluku (Buru Island). Detailson the completed R&U subprojects in each province are presented in Appendix 1.

b. Special Maintenance and Handover Schemes

7. Under the SM component, only 5 of the 24 schemes identified at appraisal could beupgraded to a 'technical" level within the cost ceiling of $125 per ha. As a result, the scope ofthe SM subcomponent was reduced from 30,000 ha to 5,484 ha.

8. The project was to provide institutional support for the handing over of irrigation schemeswith areas smaller than 500 ha to properly trained water users associations (WUAs). Projectactivities included assistance to develop system-wide federations of WUAs and special trainingin O&M for WUAs, district, and subdistrict irrigation staff. During implementation, it appeared thatmost schemes needed minor improvements before they could be handed over. Consequently,the Bank approved the use of the remaining SM loan allocation for the improvement of schemes

Excluding the Teluk Lada irrigation project in West Java.

[C]

with areas less than 150 ha at a maximum cost of $200 per ha. Under these new arrangements,109 schemes were completed as shown in Table 2.

Table 2: RehabilitatIon of Small Irrigation schemes

Province No. of Schemes Total Area (ha)

North Sumatra 86 8,900Aceh 23 2,500

Total 109 11,400Source: consultants' PCR, PWRS

9. Farmers' participation in the planning and construction of the improvement works hasbeen minimal. At the time of the PCM, the Ministry of Public Works had issued a decree forhanding over 19 schemes in Aceh, covering an area of 1 ,973 ha. In North Sumatra, the handingover of 79 schemes covering a total area of about 8,000 ha was completed in August 1995. Theactual achievement is well below the appraisal target of 35,000 ha. To complete the programin the near future a greater commitment of local government agencies is required.

c. Efficient Operation and Maintenance (EOM)

10. The EOM program started in FY 1988/89 in several schemes in North Sumatra Province.At Project completion, it had covered 95,509 ha or about 85 percent of the appraisal target of113,000 ha. The coverage of the EOM program is summarized in Table 3 and details arepresented in Appendix 2.

Table 3: Summary of EOM Coverage by Province (ha)

Source of Previous Funding forRehabilitation/Construction

North Sumatra Aceh Maluku Total

1. R&U and SM subcomponentof the Project

2. Other Bank loansa. Loan No. 638-lNOtb. Loan No. 685-lNO2

3. Other sponsoring agenciesa. Government fundsb. OECF loanc. Australian grant

8,013 4,050

46,934 0

0 6,920

0 11,215

6,300 0

7,265 0

4,812 16,875

0 46,934

0 6,920

0 11,215

0 6,300

0 7,265

Total 65,512 22,185 4,512 95,509Source: Consultants' RCA, PWRS

Second Irrigation Sector Project, for $85.0 million, approved on 22 September 1983. Completedon 25 August 1993.

2 Arakundo-Jambu Aye Irrigation and Flood Control Project, for $68.0 million, approved 5 July 1984.Completed on 2 September 1994.

11. About 16,875 ha included in the EOM program are located in R&U and SM subprojectscompleted under the Project, and 53,854 ha are in subprojects completed under previous Bankloans. The remaining areas were in non-Bank-financed schemes, which met EOM selectioncriteria. Because of the late completion of the R&U subprojects, the EOM program in NorthSumatra fell about 20 percent short of its target.

4

12. The O&M condition of the inspected schemes included under the EOM program did notalways meet the required standards. In a number of cases, additional budget should be madeavailable to carry out more substantial repairs, which are beyond the scope of EOM.(Trienggading subproject, Aceh). It was noted that most of the EOM funds were used to provideadditional canal lining to facilitate future maintenance. Routine maintenance activities such ascanal cleaning and maintenance of gates were not given adequate attention and, in many cases,O&M manuals were not available. In most schemes, measurement structures were notfunctional. These shortcomings, however, did not yet seem to pose a major constraint toirrigation in most of the schemes visited by the PCM in Aceh and North Sumatra. In theseschemes, rainfall seems to be adequate throughout the wet season and most part of the dryseason, and irrigation is of a supplementary nature only. However, in areas with a distinct dryseason such as in the districts of Aceh Utara (Aceh), Asahan and Deli Serdang (North Sumatra),and Maluku these shortcomings will eventually affect irrigation water availability.

d. Surveys, Investigations, and Design

13. In addition to the SIDs carried out for R&U, SM, and P1K schemes, SIDs for phase 2 ofthe eight-year investment program were prepared for 37 subprojects with an aggregate area ofabout 38,988 ha. This is slightly above the appraisal estimate of 37,000 ha.

e. Institutional Strengthening

14. The institutional strengthening activities were to cover the provincial, district, andsubdistrict irrigation services, provincial and district irrigation committees, and WUAs. Theyincluded (i) provision of adequate staff at all levels, (ii) training of staff, and (iii) provision ofequipment and facilities as necessary.

i. O&M Staffing

15. Although the number of O&M service staff has increased since the time of appraisal, thepresent numbers and skills mix is still inadequate to operate and maintain the irrigation systemsproperly. A comparison of the staffing levels envisaged at appraisal and the actual is presentedin Table 4.

Table 4: Staffing of Irrigation Services(Appraisal and Present)

North Sumatra Aceh MalukuLevel

Required Actual Required Actual

Required Actual

Required Actual

Province 71 1,036a 13 282a 5 3

89 t,321a

District

526 566 432 171 0 0

960 737

Subdistrict 2,761 2712 2,531 488 200 15 5,492 3,215

Source: Consultants' PCR, PWRSa Number of staff at province level includes project implementation staff.

16. In Aceh and Maluku, staffing levels at district and subdistrict levels are far below theappraisal estimate. Although staff numbers meet the expected requirements in North Sumatra,the appropriateness of the skills mix is doubtful. There appear to be an excess of administrativestaff and a shortage of field staff such as gatekeepers and foremen.

ii. Training

17. It is not possible to compare the completed training program with the appraisal estimatein view of the different categorization of "target groups" and "type of training" at appraisal and inthe Executing Agency's (EA's) PCRs. However, measured in number of trainees, the completedtraining program has been more extensive than anticipated at appraisal. Two major types oftraining were carried out: (i) classroom training in water management, and (ii) on-the-job training.The "on-the-job" training program targeted the irrigation service staff at provincial, district, andsubdistrict levels. The training in water management targeted a cross section of staff of theirrigation services and local government from province to village level as well as WUAs andfarmers. A total of 11,402 persons, including key farmers, have undergone water managementtraining, while 3,601 irrigation service staff have participated in on-the-job training programs. Abreakdown of the completed training activities in the three provinces is presented in Table 5.

Table 5: Summary of Training Activities

Number of ParticipantsType of Training

North Sumatra Aceh

Maluku Total

Formal Training in Water Management

4,921 5,418

1,063 11,402

"On-the-Job" Training 1,320 2,160

121 3,601

Total 6,241 7,578 1,184 15,003Source: Consultants' PCR, PWRS

iii. Water Users' Associations

18. Traditionally, farmer groups organized and registered on a village basis already existedin the Project area. Under the Project, farmers were to be reorganized at the level of eachtertiary hydrological irrigation unit, so as to improve water management and to establish anorganizational base for collection of irrigation service fee (1SF). It is estimated that about 1,721WUAs are required in the various categories of subprojects implemented under the Project.Presently, only 471 WUAs (27 percent) are registered with the district Chief (Bupati) while 731(42 percent) were trained under the formal training program in water management (see Table5). The present status of the WUAs in the three provinces is detailed in Table 6. The absenceof adequate numbers of WUAs in the subprojects will delay the introduction of EOM and 1SFactivities in the completed subprojects.

Table 6: Status of Water Users Associations

Number of WUAsProvince Schemea

Area (ha) Requiredb Established Trained Registered

North Sumatra 92,308 1,230 722 536 362Aceh 32,014 427 242 163 163Maluku 4,812 64 32 32 32

Total 129,134 1,721 996 731 471Source: Consultants' PCR, PWRS

Includes R&U, SM, EOM, and P1K schemesb Estimate based on a tertiary irrigation unit of 75 ha.

6

iv. Buildings and Equipment

19. A total of 280 office buildings and staff houses for provincial, district, and subdistrictirrigation services were constructed, In addition, a large variety of equipment, furniture, vehicles,and other transport equipment were procured. The provision of these facilities and particularlythose with respect to O&M has strengthened the irrigation services. It was noted, however, thatsurvey and laboratory equipment were underutilized and that insufficient communicationequipment was provided. A summary of the buildings and equipment procured is presented inTable 7.

Table 7: Summary of Buildings and Equipment (Number)

Facilities North Sumatra Aceh Maluku Total

Appraisal Actual Appraisal Actual Appraisal Actual Appraisal Actual

A. Buildings1. Province level na. na. n.a. n.a.

a. Office - 1 - 2 - 1 - 4b. Housing - 0 - 5 - 1 - 6

2. District levela. Office - 17 - 6 - 2 - 25b. Housing - 45 - 30 - 0 - 75

3. Subdistrict levela. Office - 6 - 13 - 0 - 19b. Housing - 48 - 9 - 6 - 151

B. EquipmentC. Vehicles and Other Transport

a. Jeep 4-WD 11 11 11 11 4 4 26 26b. Dump Truck, 3 ton 6 6 5 5 1 0 12 11c. Pickup 6 6 5 5 1 2 12 13d. Motorcycle 55 55 24 26 12 13 91 94e. Bicycle n.a. 399 na. 0 n.a. 60 na. 459f. Mobile Training Unit 2 2 2 2 0 0 0 4

Source: Consultants PCR, PWRS

2. Agricultural Development

a. General

20. Subsequent to the loan agreement of November 1987, the scope of the agriculturecomponent was further detailed in a Plan of Implementation (P01) drawn up between theGovernment of Indonesia and the Government of the Netherlands in May 1988. The activitiesunder the agriculture component were cofinanced under a Dutch loan with the exception ofthose on Buru Island (Maluku), which were financed by the Bank.

b. Civil Works

21. A comparison of the civil works activities envisaged in P01 with those actually executedis summarized in Table 8.

Table 8: Comparison of Agricultural Civil Works Activities(per Plan of Implementation and Actual)

North Sumatra Aceh Maluku TotalActivity

P01 Actual P01 Actual P01 Actual P01 Actual

Design for Land Development (ha) 1500 1200 1300 2,2508 500 - 3,300 3,450aTertiary Demonstration Units (no.) 18 18 14 14 6 6 38 38Seed Farm Rehabilitation (no.) 9 7 7 7 2 3 18 17Improvement of Rural Extension Centers 55 55 26 26 8 8 89 89

Design for area located outside Project area.

7

22. The design for land development in the R&U schemes was delayed because of thefollowing factors: (I) delays in designs for the R&U schemes; (ii) absence of farmers (south coastof Aceh and North Sumatra provinces and Buru Island); (iii) unirrigated land; (iv) insufficientcooperation of the farmers; and (v) the scattered location of the areas, which made it difficult tocombine survey and design activities, in accordance with Government regulations, into one classA contract, which should have a minimum value of Rp60 million or about 1,300 ha equivalent ofland development.

23. When eventually, in August 1993, a contract was let for the survey and design of landdevelopment in 2,400 ha in three R&U schemes in Aceh, it appeared that the areas had alreadybeen developed by the farmers themselves under the guidance of the agricultural extensionworkers. Subsequently, the surveys and designs were carried out for about 2,250 ha in theJambu Aye Langkahan irrigation scheme, located outside the Project area. The design will behanded over to DGWRD, which has been responsible since February 1994 for the landdevelopment program within the irrigation scheme&. The transfer of the responsibility for landdevelopment from the Directorate General of Food Crops and Horticulture (DGFCH) to DGWRDwill accelerate the leveling of large areas included in the potential command area of the scheme.However, since the farmers themselves have to establish their own rice fields (construction ofbunds and final leveling within the rice field), their involvement and, consequently, that of theagriculture extension worker in preparation and design remain a prerequisite.

24. In accordance with P01, 38 tertiary demonstration units (TOUs) were established in thethree provinces. In each TDU, a TDU center was constructed as a training and meeting placefor farmers and officials. The TDU centers in North Sumatra have been in use for some time,while the TDU centers in Aceh are still relatively new. The six TDU centers in Maluku werecompleted during the last six months before loan closing. At that time the original budgetallocation was not adequate anymore. To complete the centers within the budget, the floor areawas reduced to only 22 square meters (m 2), which is too small to serve as a meeting place. Thelocation of the TDUs is given in Appendix 3.

25. A total of 17 seed farms were upgraded through the provision of drying floors, godowns,and improved irrigation systems. The locations of the seed farms are presented in Appendix 4.Because of time and financial constraints, the facilities provided in Maluku are poorly plannedand are less than adequate because of their small size and inappropriate location.

26. In accordance with P01, 89 rural extension centers (RECs) were provided with a smallstorage room. The originally proposed drying floors were deleted because RECs have no seedproduction function as was envisaged at appraisal.

c. Equipment, Materials, and Facilities

27. A total of 16 packages of equipment for seed farms and 38 packages of small farmequipment for TDUs were procured. In view of the centralized procurement procedures, specificrequirements were not always adequately reflected in the technical specifications. As a result,the procured equipment is not always in line with location and specific requirements. Forexample, heavy immobile threshers were provided to TDUs needing a separate motorized drivingsource, which was not procured.

1

Prior to February 1994, Directorate of Agriculture and Area Development within DGFCA was responsible for theland development activities.

8

28. To enhance communication at various levels of the project organization, 274 motorbikesand 28 cars were procured. Details of the envisaged procurement and that actually realized aresummarized in the Table 9.

Table 9: Procurement and Distribution of Transport Facilities

Total Central Province

District

SubdistrictVehicles

P01 Actual P01 Actual

P01 Actual

P01 Actual

P01 Actual

Cars 19 28 7

6 12 14

0 0Motorbikes 218 274 1

27 0 64

217 182

29. To enable in-house production of extension material, audiovisual equipment was procuredfor use at the former DGFCA and the Provincial Agriculture Services (PRASs) of Aceh, NorthSumatra, and Maluku. In addition, audiovisual studios/workshops were built in Jakarta, BandaAceh, Medan, and Ambon. With the recent reorganization of DGFCA (now DGFCH), theaudiovisual studio in Jakarta was transformed into office space. The audiovisual workshops inthe three provinces are empty buildings that need furniture and air conditioning for storage ofsensitive equipment. As a result, the audiovisual equipment is inadequately stored andunderutilized.

d. Training, Extension, and Demonstration

30. The training and extension program focused on improved agricultural technology, watermanagement, and seed production. The main target groups were key farmers (both male andfemale) and agricultural service staff. About 550 classes were conducted: 254 in Aceh, 215 inNorth Sumatra, and 81 in Maluku. Most classes were conducted during the period from April1993 to September 1994. In line with P01, eight overseas training courses were conducted.They used 48 person-months, compared with the P01 estimate of 54 person-months. Thecourses are summarized in Table 10. Despite the emphasis on audiovisual training, bothDGFCH and the provincial services (PRAS) have not been able to make effective use of theaudiovisual facilities and equipment provided under the Project (refer to para. 29).

Table 10: Summary of Overseas Training Courses

Subject

Seed ProcessingAgriculture and CommunicationWomen in AgricultureIrrigation Water ManagementPaddy Land FormationProgramming and PlanningAudiovisualManagement and Organization

Country

New ZealandNew ZealandNew ZealandNew ZealandNew ZealandNew Zealand

USAUSA

Duration Staff(months) (no.)

222

31. Production Technology Demonstration (PTD) Units were to be established at 120locations in the Project area. The PTD units would be used to transfer new technologies tofarmers. The actual number of PTD units established in each province is presented in Table 11.Because of major institutional deficiencies in PRAS, no PTD units were established in Maluku.In Aceh, the achievement is only 50 percent.

9

Table 11: Distribution of PTD Units(P01 and Actual)

PTD Units (no.)Province Coverage of ACTIP

(ha) P01 Actual

Aceh 36,000 28 14North Sumatra 101,000 82 117Maluku 9,000 10 0

Total 146,000 120 121Agriculture Component for Third Irrigation Project.

3. Land Tax Improvement

32. To improve land tax revenues, the Project supported the introduction of the new land andbuilding tax (PBB). The support included (I) mapping, identification, and valuation oflandholdings; and (ii) institutional strengthening of the provincial PBB offices through training andthe provision of equipment. The total area to be mapped was estimated at 210,000 ha at thetime of Project appraisal. The area actually mapped was about 191,775 ha, of which 45,690 hawas in subprojects implemented under the R&U and EOM programs. Details of the coverageand incremental taxable land values are summarized in Table 12.

Table 12: Implementation Details of PBB Component

Appraisal

ActualItem

Total

Aceh North Sumatra Maluku Total

Mapping and identification (ha)

38,531 137,118 16,126 191,775

Incremental land valuena. 203,286 391,733 1,104 569,123

- percentage n.a. 379 65 6 450

33. Incremental tax revenues under the PBB component are adversely affected by the newtax law ordinance no. 12 of 9 November 1994. This ordinance provides the owner of land andbuildings with a flat Rp8.0 million reduction of the total assessed value of his properties. Sincemost of the landholdings in the Project area are small with individual values seldom exceedingRp8.0 million, the impact of this ordinance has significantly reduced PBB tax revenues in thethree provinces.

34. To strengthen the three regional tax offices, microcomputer systems, survey equipment,and vehicles were procured. In addition, ten staff from each provincial office underwent a three-month local training program on cadastral data processing.

4. Irrigation Service Fee

35. After a considerable delay in the recruitment of the consultants, the 1SF pilot programstarted in June 1990. Under the program, assessment of farmers' payment capacity was carriedout, and procedures and the organizational setup for the collection of 1SF were determined. InNovember 1991, at the end of the consultants' assignment, the actual collection had coveredonly about 2,400 ha, at a collection rate of 79 percent, while a collection program for anadditional 14,800 ha had been prepared. Because of the absence of an operational budgetpreviously provided for under the consultants' contract, collection rates dropped to a low of 12percent in 1992 (coverage 10,000 ha).

iii]

36. To reactivate the 1SF program, the Bank approved the Government's request foradditional consulting services from August 1992 to July 1993. The consultants assisted with (I)the establishment of the legal framework for 1SF collection, (ii) training of district officials, and (iii)reactivation and expansion of the pilot area. At the time of the PCM, the actual coverage andcollection rates were still far below expectation, as indicated in Table 13.

Table 13: Status of 1SF in North Sumatra (1994/95)

District Coverage (ha) Collection Rate(%)

Simalungun 10,000 41Asahan 5,000 18Deli Serdang 1 880 nilNorth Tapanuli 300 ntl

37. However, the PCM noted that district governments in North Sumatra are becoming moresupportive of he 1SF program and that operational budgets have now been provided for FY1 99596. This may result in an upward trend of the collection rates in FY 1995/96. In Aceh, theprovincial government has started 1SF collection in three irrigation schemes covering 2,200 ha.No SF collection activities have been scheduled in Maluku.

B. mplementation Arrangements

1, Executing Agencies and Project Organization

a. Coordination at National Level

38. The three Executing Agencies (EAs) for the Project were the Directorate General of WaterResources Development (DGWRD), the Directorate General of Food Crops and Horticulture'DGFCH) previously called Directorate General of Food Crops and Agriculture (DGFCA), and theDirectorate General of Tax (DGT). BAPPENAS in cooperation with the EAs and other relevantagencies such as Directorate General of Public Administration and Regional Autonomy(DGPARA) and the Directorate General for Regional Development (DGRD) were responsible forcoordination and monitoring at the national level. In practice, most of the coordination at thenational ievel was done by the Directorate of Planning of the lead agency, DGWRD.

b. Irrigation Development

39. Within DGWRD, a Project Guidance Unit (PGU) was established in December1987. PGUcomprised staff from the Directorate of Programming and Directorate of Irrigation (DOl), assistedDy two internationally recruited consultants. PGU was responsible for a wide range of activitiessuch as monitoring, planning, programming, and reporting, standardizing, and streamliningprocedures. At provincial and lower evels, PWRS, assisted by the district and subdistrictirrigation services, was responsible for implementation. District and subdistrict level services,which particularly should have been involved in the organization of farmers and constructionsupervision, have only marginally been involved. Most design, contracting, and constructionsupervision was carried out by PWRS, assisted by consultants. The envisioned employment ofcommunity organizers to act as catalyst in the formation of WUAs could not be realized becauseof the absence of the appropriate budget.

11

40. In Simalungun (North Sumatra), the district irrigation committee (BAMUS) was establishedto set up the 1SF pilot area. In all the Project districts, the envisioned reactivation of the districtirrigation committees was never realized because coordination between the agriculture andirrigation services and the local government was limited.

c. Agricultural Development

41. Under the previous DGFCA, the Directorate of Food Crops Extension (DFCE), Directorateof Food Crops Production (DFCP), and DAAD constituted the Project Guidance Unit (PGU)responsible for coordination and monitoring at the national level. The responsibility for the dailymonitoring and coordination was delegated to a Project Management Unit (PMU).

42. At the provincial level, Project Implementation Units (PlUs) and working groups wereestablished with similar setup and responsibilities as, respectively, the PGU and PMU at thenational level. Because of major institutional deficiencies, FlU in Maluku has not been successfulin executing its mandate.

43. In April 1994, DGFCA was reorganized and renamed as the Directorate General of FoodCrops Production and Horticulture (DGFCH). DGFCA was abolished and the Directorate of FoodCrops Production Development (DFCP) took over the responsibilities as the main directorateresponsible for the implementation of the agriculture component. In February 1994, theresponsibility for land development was transferred from DGFCA (DAAD) to DGWRD (refer topara. 23).

d. Irrigation Service Fee

44. The EA for the 1SF component was the DGPARA within the Ministry of Home Affairs(MOHA). The recruitment of consultants was carried out by DGPARA. The district governmentwas responsible for the implementation of the program.

e. Land Tax

45. At the national level DGT within the Ministry of Finance was responsible for theexecution of the land tax component. A PGU was established at the provincial level. PGU wassupported by one domestic consultant and one international consultant.

46. Implementation of aerial photography and mapping was the responsibility of DGT. Theprovincial PBB inspection office identified and assessed the landholdings.

2. Selection and Processing of Irrigation Subproject

a. R&U Subprojects

47. The selection criteria in Section Il.A(a) of Schedule 6 of the Loan Agreement had beenfollowed in general. It was noticed, however, that the concept of rehabilitation of "existing"irrigation facilities had been interpreted in a liberal way. In some subprojects, substantialexpansion areas were provided with new irrigation facilities. In a number of cases, these areasare presently underutilized because of the absence of paddy land development and/or farmers.

b. SM Subprojects

48. The subprojects included in the SM program were in general selected as per criteria set

Project Component

A. Irrigation Development (DGWRD)B. Agricultural Development (DGFCH)0. Land Tax Improvement (DGT)D. Irrigation Service Fee (DGPARA)E. TaxesF. Interest and Service Charge During Construction

1. Bank Loan (OCR and ADF)2. Government of the Netherlands

Total Project Cost

12

out in Section ll.B of Schedule 6 of the Loan Agreement. A number of the schemes had alreadybeen identified during appraisal. After detailed investigations, however, it appeared that noneof these schemes could be rehabilitated below the ceiling of $125 per ha. The Bank thenapproved the use of the SM allocation for minor improvements of small schemes (smaller than150 ha) before they were handed over to WUAs. At the same time, the cost ceiling was raisedto $200 per ha.

c. EOM Subprojects

49. The selection of EOM subprojects was based on criteria developed by DGWRD andapproved by the Bank. The criteria included, among others, (i) adequate operational capacityof the schemes in terms of physical facilities and staffing; (ii) non-requirement of major physicalrepair; (iii) availability of operation procedures including O&M manuals, as-built drawings, andother technical data, and (iv) sufficiency of O&M facilities. The procedures for selection alsorequired site inspection of the schemes by senior PWRS officials to assure that all criteria hadbeen met.

50. The PCR mission noted that several of the inspected schemes did not meet the abovecriteria and should not have been included in the EOM program. Two of the inspected schemesin Aceh needed rehabilitation far beyond the scope of EOM. In four of the inspected schemesin North Sumatra, O&M manuals were lacking and trained O&M staff were inadequate. In mostof the schemes, calibration of measuring structures had never been carried out and as-builtdrawings and O&M manuals were not available.

C. Projects Costs

51. The total Project cost at appraisal was estimated at $150 million. The actual expendituresin current prices by the end of March 1995 amounted to $150.2 million, close to the appraisalestimate. The actual foreign exchange cost was 2 percent above the appraisal estimate, whilethe local cost was 1 percent lower. A summary of the total cost of each Project component asappraised and as actually incurred is presented in Table 14. Detailed costs broken down intoforeign and local currencies are given in Appendix 5.

Table 14: Comparison of Project Costs in Current Prices as Appraised and Actual($'OOO)

Appraisal

Foreign Local Total

44,200 69,750113,9503,200 5,700 8,900

600 6,550 7,150

0 10,500 10,500

9,200 0 9,200

300 30057,500 92,500150,000

Actual

Foreign Local Total

42,778 71,721 114,499

5,532 3,113 8,645

291 5,874 6,165

672 466 1,138

0 10,447 10,447

9,340 0 9,340

0 0

58,613 91,622 150,235

52. Bank loans from Asian Development Funds (ADF) resources of SDR46,587,000 ($60million equivalent) and Ordinary Capital Resources (OCR) of $60 million were to finance 80percent of the total Project cost. The Government of the Netherlands was to finance $7.5 million

13

($2.8 million on a grant basis and $4.7 million as a loan) or 5 percent of the total Project cost.The remaining $22.5 million (15 percent) was to be financed by the Government of Indonesia.At the request of the Government of Indonesia, the Bank established in June 1990 separate loancategories for 1SF introduction in the amount of $1,104,000 equivalent, and for agriculturaldevelopment at Buru Island, Maluku, in the amount of $325,000 equivalent. The total amountof $1,429,000 was reallocated from part A, Irrigation Development. At Project completion, theBank had financed 78 percent of the Project cost, the Government of Indonesia 17 percent, andthe Government of the Netherlands 5 percent compared with the appraisal ratio of 80:15:5,respectively. The increase in Government financing was the combined effect of (i) Governmentfinancing of Kairatu weir (Maluku), and (ii) a one-year extension of the loan closing date. Theoriginal estimate and actual financing are summarized in Table 15 below and detailed inAppendix 6.

Table 15: Financing Plan ($ million)(at Appraisal and Actual)

Foreign Cost Local Cost Total Costs PercentageSource

Appraisal Actual Appraisal Actual Appraisal Actual Appraisal Actual

The Bank1. ADF2. OCR

The Government of the NetherlandsThe Government of Indonesia

Total

54.0 53.3

25.6 26.0

28.4 27.3

3.2 5.3

0.3 0.0

57.5 58.6

66.0 63.8

34.4 34.4

31.6 29.4

4.3 2.3

22.2 25.4

92.5 91.6

120.0 117.2

60.0 60.5

60.0 56.7

7.5 7.6

22.5 25.4

150.0 150.2

80 78

40 40

40 38

5 5

15 17

100 100

D. Project Schedule

53. The Project was to be implemented over a five-year period from April 1988 through March1993 (refer to Appendix 7). The actual implementation period was six and a half years from April1988 to 30 September 1994. Delays were caused mainly by the late completion of the civilworks for the irrigation and agriculture components. Construction of the ten R&U sampleschemes for which the design was completed under the Bank-financed Second Irrigation Sectorloan (Loan No. 638-INO) started in January 1989. The construction of the remaining R&Usubprojects was significantly delayed because of the unfamiliarity of PWRSs with the preparationof the agro-institutional profiles (AlPs) and because of delays during the design and tenderingperiod. Construction of the R&U schemes started in February 1992, some two years behind theappraisal schedule. The last scheme was completed in September 1994, one and a half yearsafter the original date of physical completion (March 1993).

54. Under the agriculture component, the civil works for buildings and the establishment ofTDUs were significantly delayed because of EA's unfamiliarity with the preparation andprocurement of civil works and the late completion of the R&U schemes. The last TDU centerwas completed in Maluku in September 1994, more than two and a half years behind schedule.

55. Although the start of the survey and mapping for the land tax reassessment componentwas delayed, this component was completed before the original loan closing date of 30September 1993.

E. Engagement of Consultants and Procurement of Goods and Services

1. Consultants

56. Project Consultants were recruited in accordance with the Bank's Guidelines on the Useof Consultants. International consultant firms in association with domestic consultant firms were

Total

2,44580179758414112234542

121

14

recruited to assist, advise, and train the EAs in the management and implementation of theirProject component. At Project completion, a total of 2,953 person-months had been usedcompared with 1,996 person-months estimated at appraisal. A breakdown of the consultingservices for each Project component is given in Table 16.

Table 16: Consulting Services for Project Implementation (person-months)(Appraisal and Actual)

Prolect Component

A. Irrigation1. North Sumatra2. Aceh3. Maluku4. Teluk Lada5. Project Guidance Unit

8. AgricultureC. Land Tax0. Irrigation Service Fee

Appraisal

International Domestic Total

1i LZJ202 465 667189 448 637111 162 27336 53 8948 - 48

120 138 258

n . a . an.a.a

Actual

International Domestic

757

1,688

245

556

225

572

172

412

54

87

61

61

160

176

12

30

40

81

Total 730 1,266 1,996 978 1,975 2,953Included under A.

57. Total consultant inputs exceeded the appraisal estimate by 48 percent. Some of thencreases can be attributed to the one-year delay in Project implementation. The major part ofthe increases and in particular the increase for the irrigation component (Maluku Province) wascaused by lack of adequate staff capacity and staff numbers at the provincial, district, andsubdistrict levels. In addition, the 1SF consultants had to be remobilized to reactivate the SFpilot project in North Sumatra.

58. A large number of domestic consultants were recruited to carry out surveys,investigations, design, and construction supervision of the civil works. The Bank approved therecruitment of the consultants on the basis of 'lump-sum contracts, provided the contract costwas below $100,000. In this manner 43 domestic consultant contracts were procured at a totalcost of about $3.2 million.

2. Civil Works

59. Under the irrigation component, 75 civil works contracts were tendered all under localcompetitive bidding (LCB) procedures acceptable to the Bank. Twenty contracts covered therehabilitation of one subproject each. The rehabilitation of the remaining 16 subprojects wascarried out under two or more contract packages. Separate small LCB contracts were let for theconstruction of buildings. Under the ACTIP component, the civil works contracts were small,consisting of the construction of TDU centers, seed farms, field offices, and staff houses.Because DGFCH lacked experience in preparing and procuring contracts for civil works, majordelays occurred.

3. Equipment

60. The equipment procured under the irrigation component included (i) hydrological andmeteorological equipment, (ii) telecommunications equipment, and (iii) O&M equipment.

15

Equipment for ACTIP consisted of (i) farming equipment, (ii) aboratory equipment, (iii) furniture,and (iv) farm supplies and implements. AU equipment was procured under LCB procedures.

F. Performance of Consultants and Contractors

1. Consultants

a. Irrigation Development

61. In North Sumatra, Aceh, and Teluk Lada, the international implementation consultantswere employed under the "assistance concept", whereby responsibility remained with the EA.The domestic consultants were responsible for SID. In Maluku, the international consultants hadresponsibility for the survey and design of the main irrigation systems under a "task concept",while survey and design of the tertiary irrigation systems was assigned to domestic consultants.

62. The PCR mission found the performance of the international consultants in generalsatisfactory. In some instances, however, they could have been more assertive in pursuingtechnical issues with the EA (Teluk Lada, North Sumatra).

63. The SID consultants performed marginally. Many design modifications were requiredduring construction, resulting in large contract cost overruns. The average cost overrunamounted to 31 percent in Aceh, 21 percent in North Sumatra, 11 percent in Teluk Lada, and4 percent in Maluku. A breakdown of the cost overrun for each subproject is presented inAppendix 8. The large cost overruns, particularly those in Aceh, cast doubts on the adequacyof the design and on the effectiveness of the LOB procedures in achieving cost-effectiveness.

64. The lack of adequate procedures for the use of consultants in construction supervisionlimited their effectiveness in the field. Too much depended on the informal working relationbetween the consultants and the PWRS project staff rather than on established administrativeprocedures. Proper reporting and follow-up procedures on construction quality issues shouldbe developed to increase the effectiveness of the consultants.

b. Agricultural Development

65. The ACTIP consultants were directly financed and supervised by the Government of theNetherlands. In the absence of information from that Government, the PCR mission is not in aposition to comment in detail on the performance of the ACTIP consultants. The Mission noted,however, the high cost of the services. At the termination of the first consultant contract in April1992, one and a half years before the original loan closing date, the total cost for consultingservices already exceeded the appraisal estimate by about $1 .95 million or 83 percent. AtProject completion, the cost for consulting services amounted to about $4.5 million, or 47percent of the total cost of the agriculture component. The PCM has not been able to confirmits findings with the Government of the Netherlands.

c. Irrigation Service Fee

66. The consultants recruited during the first phase introduced 1SF activities in a pilot areaof 14,000 ha. At the end of their assignment, partial collection covered only 2,400 ha. Theconsultants recruited during the second phase from August 1993 to July 1994 tried to reactivatethe program in the pilot area and, at the same time, to expand it to other areas. Theirperformance was considered satisfactory. After the consultants left, the coverage of the program

16

quickly decreased for lack of an operational budget, previously financed under the consultants'contract.

d. Land Tax

67. The two individual consultants (one domestic and one international) carried out their taskvery satisfactorily. The assignment of the domestic consultant was extended by six monthsbecause of the delay in Phase II of the program, field identification, and registration ollandholdings.

e. Project Guidance Unit

68. The consultants in PGU were responsible for planning, programming, reporting,standardizing, and streamlining procedures; monitoring all procurements; and coordination withother agencies. In this connection, the PCM noted that the PGU consultants had not carried outthe standardizing of EOM and handing-over procedures, timely updating of the plan ofimplementation, and the submission of consolidated progress reports. In many cases, the PGUconsultants were not aware of Project implementation issues between the EA and the Bank. ThePCM rates the performance of the consultants marginal.

2. Contractors

a. DGWRD Components

69. The performance of the contractors in the DGWRD component varied. Of the 74 civilworks contract for R&U, only 13 contracts were completed on time. Forty contracts weredelayed for more than 3.0 months and 25 were delayed by more than 6.0 months. The averagedelay per contract was 5.6 months in North Sumatra, 5.8 months in Aceh, 2.7 months in Maluku,and 5.7 months for the Teluk Lada subproject. The details for each contract are presented inAppendix 9. The delays were caused mainly by one or a combination of the following factors:(i) poor performance of the contractors, (ii) frequent design changes during construction, and(iii) delayed land acquisition. The quality of the head works and major canal structures wasgenerally good. The quality of the earthwork and canal lining varied. In some subprojects(Panga Pucuk and Krueng Jreue), the quality of the canal lining was unsatisfactory. In PayaSordang, substantial improvements of selected canal sections and structures were required.Further details on PCM's assessment of the quality of the inspected subprojects are in Appendix9.

b. DGFCH Component

70. Contracts executed under the DGFCH component involved mainly small civil works foroffice buildings, TDU centers, utility buildings, and staff houses. The performance of thecontractors varied from marginal to satisfactory.

c. PBB Component

71. The performance of the three contractors for aerial photography were generallysatisfactory. In some cases (North Sumatra), the inadequate quality of the ortho-photomapscaused some delays. This situation was later corrected. The consultants engaged for theground survey and identification of landholdings performed satisfactorily and achieved timelycompletion of the project in spite of the initial delays.

17

G. Conditions and Covenants

72. Although the Government has complied with most covenants in the spirit of the LoanAgreement, the following areas need further attention: (i) improvement of coordination and pro-ject guidance and monitoring, including submission of consolidated progress reports at the na-tional level; (ii) strengthening of both PRAS and PWRS in Maluku, and posting of addttional fieldstaff for O&M; (iii) provision of adequate budget to reactivate the 1SF program in North Sumatra;(iv) provision of adequate O&M funds to maintain EOM levels; and (v) increasing the level offarmers' participation particularly in the implementation of the handing over program. The statusof the Government's compliance with the various loan covenants is given in Appendix 10.

H. Disbursements

73. The actual disbursements of both loans were made over a period of 6.7 years fromOctober 1988 to May 1995 compared with the 5.5 years estimated at appraisal. The protracteddisbursement period reflects the delay in the completion of R&U schemes in all three provinces,excluding Teluk Lada, and the civil works for ACTIP in Maluku. At the time of the preparationof the PCR, the total disbursement from both Bank loans amounted to $1 17.2 million whiledisbursements from the Dutch loan and grant (consultant services) amounted to about $7.7million. Disbursements from the Bank's ADF and OCR loans amounted to $60.5 million and$56.7 million, respectively. The value of the ADF loan had increased from $60.0 million at thetime of appraisal to $64.0 million at the time of the PCR. The disbursement schedule ispresented in Appendix 11.

I. Environmental Impact

74. During appraisal in June 1987, no particular emphasis was put on the environmentalaspects of the Project. During the implementation of a large number of the subprojects, the

need for soil conservation measures in the catchment of the subprojects became apparent. Inall subprojects in Maluku and in selected subprojects in Aceh (e.g. Krueng Jreue) and NorthSumatra (e.g. Paya Sordang), sedimentation in the intakes and canals poses a major O&Mproblem. Although the provincial governments are taking steps to protect the concernedcatchments, uncontrolled logging and burning of the forest are still taking place.

75. At subproject level the adverse environmental impact of the rehabilitation works is minor.In some new subprojects, some adverse impact of deep hill cuttings (Krueng Susoh) andimpeded natural drainage (Paya Sordang) was observed. To compensate for the absence ofan initial environmental evaluation (lEE) of the subprojects, they should be included in anenvironmental monitoring program in accordance with AMDAL (Environmental ImpactAssessment Analysis) guidelines.

J. Performance of the Borrower and Executing Agencies

1. Interagency Coordination Committee

76. The impact of the interagency coordinating committee on the implementation of theProject is difficult to quantify. However, it could have played a more instrumental role in

18

providing policy guidance on the collection of 1SF and the handing over of small irrigationschemes.

2. Irrigation and Related Works

77. DGWRD delegated the responsibility for project implementation to the three PWRSs andthe project manager in the case of the Teluk Lada irrigation project. As regards achieving thephysical objectives, the EA's representatives at the subproject level have performed satisfactorily.However, a general weakness was the inadequate compliance with established survey,investigation, design, and construction supervision procedures. This has led in Aceh, inparticular, and, to a lesser extent, in Sumatra to large numbers of variation orders and high costincreases. PWRSs have insufficiently addressed the institutional issues associated with farmersparticipation in the implementation of the irrigation program. The overall implementation capacityof PWRS in Maluku remains weak and will need further strengthening.

78. DGWRD as the EA experienced difficulties in coordinating the activities in the threeprovinces. This caused delays in the preparation of updated plans of implementation andassociated loan reallocations. At the provincial level, it was felt that DGWRD gave insufficientguidance on the implementation procedures for the handing over and EOM program. DGWRDshould have been more instrumental in controlling the excessive cost overruns in Aceh andNorth Sumatra. Overall, however, the performance of DGWRDas a coordinating and supervisingagency in this Project is considered adequate.

3. Agriculture Support Services

79. PlUs within DGFCH delegated the authority for Project implementation to PRAS in thethree provinces. PIUs in Aceh and North Sumatra performed satisfactorily but that in Maluku wasunsatisfactory. DGFCH failed to effectively monitor the activities and provide guidance to PRASand, in particular, to that in Maluku. This was reflected in delays in procurement of civil works,equipment, and training. DGFCH also was not able to establish audiovisual training facilities atheadquarters. In view of the above, the performance of DGFCH is considered less thansatisfactory.

4. Mapping and Land Tax Reassessment

80. DGT implemented this component within the original loan closing date and withacceptable quality. The performance of the provincial PBB offices was also satisfactory.

5. Irrigation Service Fee

81. DGPARA, the EA of the 1SF component, did not support 1SF activities with an adequatebudget after the termination of the first consultant's contract. After the second assignment ofconsultants, DGPARA failed to ensure adequate provincial support to maintain the momentumof the program. Therefore, the performance of DGPARA in the Project is considered less thansatisfactory.

K. Performance of the Bank

82, The Bank has been right in supporting the Government's efforts to enhance theproduction potential of existing irrigation infrastructure through system rehabilitation andintroduction of sustainable O&M practices. In view of the large numbei of medium-size

19

subprojects and the generally satisfactory track record of DGWRD in implementing such projects,the sector loan approach was justified. The PCM, however, has difficulties understanding therationale applied in selecting the Project area, which ranges from the high rainfall areas of NorthSumatra and Aceh in the west of the country to the relatively dry areas in Maluku in easternIndonesia. Physical, cultural, and institutional conditions (Maluku compared with Aceh and NorthSumatra) in the two regions differ significantly and require different approaches to bothagriculture and irrigation development.

83. Because of the wide geographical spread and great number of EAs involved inimplementation, the administration of the Project was transferred to the Indonesia ResidentMission (IRM) on 15 June 1988. A total of 11 Loan Administration Missions, comprising 266person-days, were fielded. Because of resource constraints, the duration of the Bank reviewswas limited to a maximum of 3.0 weeks per year. The average duration of a normal ReviewMission was 2.2 weeks. For a detailed review of the Project, at least 5-6 weeks would berequired. In spite of these limitations the Bank Review Missions were able to alert the EAs onthe need to improve the Project quality and to involve the project beneficiaries (WUA5) insubproject preparation. In addition, the administration of the Project by IRM facilitated promptaction on the many procurements and disbursements for the six subproject components. TheBank was instrumental in finding a sustainable solution to the intake arrangements at theGunung Pudung subproject in Aceh. On the other hand, the Bank could have been more strictin following up on institutional and technical issues associated with conditionally approved civilworks contracts such as water availability, soil conditions, and presence of WUAs. A stricterapproach, however, would have resulted in major implementation delays. Overall, the Bank'sperformance in the administration of the Project is considered satisfactory.

84. The second phase of the originally envisaged eight-year investment plan has not yet beeninitiated. Large resources have been spent during the first phase for the preparation of designsfor the overlapping follow-up phase in Aceh, North Sumatra, and Maluku. The present countryprogram for Indonesia foresees follow-up activities in 1996. It is feared, however, that by that timethe momentum of the Project will have been lost. The PCM has not been able to determine whythe second phase of the Project did not proceed as planned.

20

Ill. EVALUATION OF INITIAL PERFORMANCE AND BENEFITS

A. Attainment of Benefits

1. Initial Operations

85. Ten of the 34 R&U schemes were completed before 1993 and had been operational forabout two years at the time of the PCM. All remaining schemes were completed in the courseof 1994 and had just entered their first year of operation. The PCM estimates that of the 33,565ha located in the R&U subprojects, at least 6,000 ha is not yet planted to rice because of lackof land development and/or the absence of farmers. Full realization of the benefits on the entire33,565 ha is therefore not expected before the year 2000. This holds true in particular for thesubprojects along the west coast of North Sumatra and on Buru Island (Ambon).

86. The PCM noted that the present EOM component of the O&M budget for Aceh and NorthSumatra is in the order of Rpl 5,000 per ha. Compared with a required EOM budget of Rp32,000or $19 equivalent, estimated at appraisal by PWRSs, this amount is insufficient to carry outproper system maintenance.

2. Crop Production

87. At this point of time, only ten R&U subprojects have been completed for more than oneyear. Five of them are located in Aceh and five in North Sumatra. Although Benefit, Monitoringand Evaluation (BME) units have been established in both provinces for the duration of theproject, only the unit in Aceh has carried out a seasonal survey program. In none of theprovinces were relevant statistical data on the performance of EOM and P1K schemes collected.

88. The agriculture extension service routinely collects data on cropped area and yield. Yieldlevels reported in these statistics are in most cases twice as high as those reported by the BMEunit (Aceh). Without further detailed field analysis, the PCM finds it is not possible to reconcilethese data. Statements made in this report on physical input and output levels are thereforenecessarily judgmental and should be treated with caution.

89. Based on the available data and on PCM's own observation in the field, it is felt that thewithout-Project average annual rice yields of 2.5 tons (t) per ha quoted in the Appraisal Reportare on the low side for subprojects located in the high rainfall area in the western part ofSumatra. They may, however, be more accurate for the relatively drier areas in the eastern partof Sumatra and in Maluku. Present average yield levels in the completed R&U sample schemesin Aceh are estimated at about 4.9 t per ha. These levels will be lower in the drier sub regionsof the Project area. The with-Project and without-Project cropping intensity figures adopted atappraisal seem to be reasonable.

90. Within the limitations imposed by insufficient and unreliable data, the PCM made anupdated assessment of average paddy yields and cropping intensities and estimated theincremental food grain production at the time of full development in the year 2000. The resultsare summarized in Table 17.

21

Table 17: Estimated Incremental Rice Production in Year 2000 (PCM)

Cropping Intensity (%) Incremental

Area Without With Production (t/per annual)Category (ha) Project Project

(t/ha) (t/ha) Previous Future PCM AppraisalEstimate Estimate

R&U 33,565 3.5 5.2 130 185 170,174 155,595SM 5,454 5.0 5.2 165 155 7,513 51,750P1K 11,400 5.0 5.2 165 185 15,618 --EOMa 78,634 5.1 5.2 185 185 14,545 44,355

Total 153,297 207853 260,000Excludes EOM in SM and R&U schemes.

91. On the basis of the assumptions made in Table 17, the incremental annual riceproduction at full development as a result of the Project is about 208,000 t. This excludes anunspecified volume of palawija (non-rice) crop production for which no data were available. Thefigure is almost 20 percent lower than the incremental production figure of 260,000 t quoted inthe Appraisal Report. The main reason for this are the underachievements in the EOM andSM/PIK programs (refer to Table 1) and a higher assessment of the without-Project yields forEOM subprojects by the PCM.

B. Economic Performance

1. Economic Analysis

92. Economic analysis has been undertaken for five sample subprojects in Aceh Province,for which an analysis had been done during appraisal. The subprojects had been completedin late 1991 or early 1992 and, therefore, have generated initial benefits. In addition, adequateinformation for an economic analysis is available for these five sample subprojects over the yearsof implementation and initial operation, a situation which does not apply to the same extent tothe other subprojects. Assumptions made for the economic analysis and the computation of theEconomic Internal Rate of Return (EIRR) for each of the five schemes are presented in Appendix12. The results are summarized in Table 18.

Table 18: EIRR of R&U Sample Projects in Aceh

EIRR (%)Subproject Area (ha)

Appraisal PCM

Panga Pucuk 510 8.0 10.5Babah Rote 820 13.6 2.5Tangan-Tangan 710 13.0 14.04Paya Dapur 960 13.8 6.9Bueracan 810 12.4 9.3

All sample schemes 3,810 13.2 8.3

93. The relatively modest rates of return signify the following: (I) the need to adoptrehabilitation design and contract practices that would minimize investment costs: (ii) theimplementation of rehabilitation in a way that would minimize production losses during Projectimplementation; and (iii) the need for special attention to the provision of farm support servicesto accelerate the process of on-farm adjustments in production technology and achievement oftechnically feasible benefits.

22

IV. CONCLUSIONS AND RECOMMENDATIONS

A. Conclusions

94. The Project has been successful in so far as it has supported the physical rehabilitationof existing irrigation infrastructure. However, the slow implementation of the Government'sirrigation Policy on sustainable O&M (EOM and 1SF) will have an adverse impact on thesustainability of the new irrigation infrastructure. The economic analysis carried out for fivesample subprojects shows EIRRs varying between 2.6 percent and 14.4 percent per subproject,and 8.3 percent for all five subprojects together. Realization of these modest returns will dependon the extent to which the Government succeeds in implementing its policies on O&M and 1SFin the Project area. In addition, sufficient budget should be made available to keep themomentum of the agriculture training, extension, and demonstration program to extend theachievements of TDU to the surrounding Project areas. Full realization of the projected benefitswill further depend on the speed at which land development in the areas with new irrigationfacilities will be carried out and/or to what extent farmers can be persuaded to occupy newlydeveloped irrigated areas.

95. The potential benefits of the PBB component have been reduced significantly becauseof the issuance of the new ordinance on PBB collection in November 1994.

B. Recommendations

1. Project-related

a. Implementation Capacity

96. DGWRD is considered to have adequate institutional capacity to implement a sector loan.Under the present policy, however, much of the implementation responsibilities are delegatedto the provinces where institutional capacity is often weak. For future sector projects, a morein-depth analysis of the institutional capacity at both provincial and district levels should berequired.

b. Land Development

97. DGWRD should give high priority to the development of paddy land in areas providedwith irrigation facilities under the Project.

c. Water Users Associations

98. A large number of WUAs still need to be established, trained, and registered (see para.18). The PCM is of the opinion that the present irrigation service staff do not have theappropriate social orientation to carry out these activities. Specially trained communityorganizers should be added to the district and subdistrict irrigation staff to assist with theestablishment of WUAs and the organization of the training programs.

d. Handing Over Schemes

99. For the same reasons as explained in para. 98 community organizers should be used toassess the willingness of the farmers to take over the O&M of their schemes and to assist themin prioritizing the system improvements to be made before the systems are handed over.

23

e. Survey, Investigation, and Construction Supervision (SIDCON)

100. The inadequate compliance with existing SIDCON procedures has led to cost overruns,delays, and, in some instances, unsatisfactory Project quality. The quality assurance office atDGWRD should be given the mandate to review compliance with proper procedures in case theneed arises and to initiate appropriate action if required.

f. Supervision of Consultants

101. The EA should carefully scrutinize the output of the many consultants employed forSIDCON activities. For this purpose, adequate staff should be posted at the provincial anddistrict levels.

g. Agricultural Extension and Demonstration Packages

102. DGFCH should develop more area-specific extension and demonstration packages.Given the wide variety of the physical features of Indonesia, the use of standard packages doesnot seem appropriate.

h. TDUs

103. To maintain the momentum of agriculture extension in the areas surrounding TDU,adequate budget allocations for extension and demonstration should be provided.

i. Audiovisual Workshops

104. Both DGFCH and PRAS in the three provinces should immediately set up properlyfurnished and equipped audiovisual training centers with air-conditioned storage for the largeinventory of audiovisual equipment procured under the loan.

j. Use of Aerial Photomaps

105. The detailed photomaps and cadastral maps prepared under the PBB component shouldbe made available to PWRS to assist in the design of particular tertiary irrigation developmentin subprojects covered by the surveys.

k. Timing of Project Performance Audit

106. The Project performance audit should be undertaken in late 1999, when the full Projectbenefits are expected to be achieved. The EA should be requested to collect the necessary datain preparation for the Project performance audit.

2. General

a. Hydrological Data Base

107. The absence of reliable long-term hydrological data makes it difficult to properlydetermine the need and economic feasibility of new irrigation development. Also in existingprojects, data on water availability are not routinely collected. In view of the various sectors'increasing demand on the limited water resources, the installation of a country-wide hydrologicalnetwork is urgent.

24

b. National and Provincial Master Plan for Water Resources Development

108. The rationale of Bank-financed water resources development projects in Indonesia hasmostly been derived from the objectives in the Government's five-year plans (Repelitas). Overthe last 15-20 years, these objectives were, as far as irrigation development is concerneddirected at obtaining and maintaining self-sufficiency in food grain production. Given theincreasing pressure on the limited available water resources, this rationale alone can no longerbe used to justify irrigation projects in Indonesia. Future projects should be implemented as afeasible component of river basin development programs, which should, in turn, fit into a nationaland/or provincial (regional) master plan for water resources development.

c. O&M-Program

109. To increase the efficiency of future Bank assistance in the implementation of theGovernment's irrigation policies on O&M, appraisal missions should seek support andcommitment from provincial and district governments.

d. Irrigation Service Fee

110. For the establishment of a sustainable mechanism for the collection of 1SF a largecounterpart contribution from the Government in term of budget for additional staff, officefacilities, logistical provisions, and operational cost is required at provincial and district level.

e. Consultant Services

111. The PCM is concerned about the intensive use of international and domestic consultantsby DGWRD for Project implementation, without providing them with proper guidance andsupervision. In all four subproject areas, different design philosophies were applied, resultingin a wide variety of structures and lay outs. In addition, the large dependency on consultantsfor simple engineering activities is eroding the in-house capabilities of DGWRD and reducing theimpact of institution-building activities. This issue should be given greater attention duringproject preparation by the Bank.

25

APPENDIXES

Number Title Page Cited On(page,paa)

1

Details of Completed R&U Subprojects

26

2,6

2

Details of EOM Subprojects 27

3,10

3

Location of Tertiary Design Units

30

7,24

4

Location of Seed Farms

31

7,25

5

Detailed Project Cost Estimates 32

12,5 1

6

Project Financing Schedule 34

12,52

7

Project Implementation Schedule

35

13,53

8

Contract Data of Rehabilitation and

36

1563Upgrading Subprojects

Details of Inspected Rehabilitation and

39

16,69Upgrading Subprojects

10

Status of Compliance with Loan Covenants

40

17,72

11

Annual Disbursement Schedule by Category

43

17,73

12

Economic Analysis 44

21,92

Seram

Buru

B u ru

Buru

B u ru

715

2,020

396

750

931

4,812Subtotal

Maluku

Maluku

Maluku

Maluku

Maluku

Kairatu

Way Meten

Way Bini

Way Geren

Way Lata

Aceh

Aceh

Aceh

Aceh

Aceh

Aceh

Aceh

Aceh

Aceh

Aceh

Subtotal

840

400

1,050

710

960

2,440

161

426

2100

2,246

11,333

Pidie

Aceh Barat

Aceh Selatan

Aceh Selatan

Aceh Selatan

Aceh Besar

Aceh Besar

Aceh Besar

Aceh Selatan

Aceh Selatan

Beuracan

Panga Pucuk

Babah Rote

Tangan-Tangan

Paya Dapur

Krueng Jreue

Krueng Geupu

Bungong Tab

Krueng Susoh

Gunung Pudung

26

Appendix 1

DETAILS OF COMPLETED R&U SUBPROJECTS

Name of Subproject Province Location Area (ha)

Subtotal

Sigodung

Uratan

Mompang

Paya Sordang

Sidulang

Aek Sibundong Kin

Sikoling-koling

Gido Zebua

Badini Lopian

Siaili Tukka

Serbangan

Silau Maraja

Sungai Balai

Serbajadi

Panca Alga

Padang Sibio-bio

Panompuan

Arse

Aek Silo

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

North Sumatra

Central Tapanuli

Central Tapanuli

South Tapanuli

South Tapanuli

North Tapanuli

North Tapanuli

Central Tapanuli

Nias

Central Tapanuli

Central Tapanuli

Asah an

Asahan

Asahan

Asahan

Asahan

South Tapanuli

South Tapanuli

South Tapanuli

South Tapanuli

377

230

292

4,350

580

602

543

1,350

1,283

957

2,272

471

977

484

768

360

510

386

628

17,420

Teluk Lada

West Java 7,334

Grand Total 52,232

27

Appendix 2, page 1

DETAILS OF EOM SUBPROJECTS

Area_______ _______ _______ Fiscal Year _______ _______ _______ _______Province/Scheme (Ha) 88/89 89/90 90/91 91/92 92193 93/94 94/95 95/96

0.1 Aceh Province 22,185Direct Schemes 18.135

1 Pub Raga 300 * * * * * =

2 Biheu Kalee 300 * * * * * = =

3 Blang Karam 200 * * *

4 Krueng Pandrah 1000 * * * *5 Tnenggading 1405 * *

6 Alue Ubay 2,260 * *7 Pante Lhong I 3562 * * *8 Pante Lhong II 2,188 * * #9 Jambo Aye I 3,480 * *

10 Jambo Aye II 3,440 * *

From R&U

11 Beuracan 810 * *12 PangaPucuk 520 * *13 Babah Rote 1,050 * *14 Tangan-tangan 710 * #15 PayaDapur 960 * *

II. North Sumatra Province 68,512Deli Serdang I

1 Nambo Rambe 1,037 * * * =2 Wonosari 581 * * * = =

3 Bandar 0010k 450 * * * * =4 Pekan Dobok 626 * * = =

Deli Serdang II

5 Medan Kilo 2,790 * =

Deli Serdarig III

6 Timbang Deli 520 * * * = =

7 Sumber Rejo 1,11 2,910 * * * * = = =

8 Ramonia 1,880 * * * = =

9 Pulau Gambar 990 * * * * = = =

Simalungun I

10 Naga Sompah 1,360 * * * = = =

11 Perdagangari 504 * * * * = =

12 Negeri Malela 469 * * = = =

13 Naga 0010k 324 * * * * = = =

14 Sibinduk 220 * * * * = =

15 Pentoam 279 * * * * * = = =

16 R. Merah/K. Sari 944 * * * = = =

17 Pinang Ratius III 379 * * * * * = = =

18 BahTongguranl 1,186 * * * = = =

19 Maligas Tongah 790 * * = =

20 Buntu Turunan 370 * * * * * = = =

21 K. Melayu/Hubuan 230 * * * * * =

Simalungun II

22 Mangajor/Manrayab 538 * * * * * = =

23 BanuaRanto 515 * * * * * = = =

24 Raya Timuran 465 * * * * = = =

25 Jawa Maligas 420 * * * * = = =

26 Bah Tangan 968 * * * * = = =

27 Bahal Gajah 530 * * * * * = =

28 Sari Matondang 354 * * * * * = = =

29 Manik Hataram 480 * * * * * = = =

30 Dobok Marlawan 260 * * * * * = = =

31 Balata/Ujung Raya 340 * * * * * = = =

32 Pubau Siborna 420 * * * * * = = =

28Appendix 2, page 2

Province/Scheme

33 Simpang Raya34 Seribu JawaIU. Bondar

Simalungun III35 Bah Horas HuluiTongah36 Negen Asih37 P. JawaIB. Jambi38 Silau MaIeIa39 Silau Merawan/Siboru40 Marjanji Asih41 Saribu Asih42 Maribun Jaya43 Panaborangan44 Jorlang Hataran45 Bah Sampuma46 Sibolangit/T.Pane

Smalungun IV47 Parlia Putar/P.Naopat48 Marihat Raja49 Sitampulak50 K. Anyar51 Bah Kabul52 Tambun53 B.KoraJS.Pane54 Kerasaan55 Bahung Kahean/B.Huruan

Simalungun V56 Java Colonisasi57 Manik Silau58 PSuntu Atas Panci59 Simarimbun60 Sibunga-bunga61 Hataran Jawa62 Serapuh63 MaIgas Bayu64 Bosar Bayu65 Bah Kisat66 Lras Il/Bt

Simalungun VI67 Dolok Malela68 Atd.l2BahJambi69 Lp. Sulim70 Bosar Malawa71 Manik Rejo72 Bah Lombut III73 Silampuyang74 Kasindir75 Saut Pardamean76 Marihat Lela77 Sordang Bolon78 Gajing Masilom79 Jawa Tongah80 Tongamangaraja

Simalungun VII81 Bah Korah52 Panombean83 Panei Tongah84 Jalangar, Siborna85 Bah Bulawan86 Huta lung

rea _______ Fiscal Year _______ _______ _______ _______(Ha) 88/89 89/90 90/91 91/92 92/93 93/94 94/95 95/96

450 * * * * = = =

600 * * * = = =

1,050 * * * * * =

900 * * * * =

690 * * * *

233 * * * * =

480 * • *

602 * * =

360 * * * * =

85 * * * * * =

185 * * * * -

162 * * * * * -

160 * * * * * =

300 * * * * =

219 * * * * =

410 * * * =

320 * * * * =

341 * * * * * =

179 * * * * * =

144 * * * * * =

406 * * * * =

3,200 * =

315 * * * * =

1,030 * * * * =

190 * * * * =

291 * * *

160 * * *

144 * * *

160 * * * * =

192 * * * =

212 * * * * *

280 * * =

760 * *

910 - * * * * =

427k578 * * * * =

169 * * * =

147 * * * * =

250 * * * =

130 * * * =

833 * * * =

207 * * * * =

142 * * * =

77 * * * * =

120 * * * =

198 * * * * =

133 * * * =

547 * * * * =

745 * * * * =

1,838 * • =

1,088 * * =

635 * =

150 * * =

222 * * =

177 * * =

+

+

I

112193415100

4.9631,000

754152156933112556

1,300

4p185140188116133420165361116213140742927454

1,1603200

2.9051,5401,365

2.5291,050

292580377230

4,812396715931

2,020750

95,509

29

Appendix 2, page 3

Area _______ Fiscal Year _______Province/Scheme (Ha) 88/89 89/90 90/91 91/92 92/93 93/94 94/95 95/96

87 Tanjung Selamat88 Raya Bosi89 Saran Padang90 Merek Raya

Simalungun VIII91 Raja Maligas92 Bah Tongguran Ill93 S. Malela94 Hantaran Bayu95 Ujung Pait96 Naga Tongah97 Bandar Tongah98 Raja Hombang

Simalungun IX99 Parik Ganjang

100 Buntu Balata101 Ambarisan102 Negeri Dolok103 SiIau Barus104 Neg. Dolok/Kahean105 S. Trotoran106 Marihat Dolok/T. Motung107 J. Huluan108 Sibatu-batu109 B. Purba110 S. Bans111 Kuala Janji/Siligoson112 Bahlonang

Asahan IV113 TanjungMuda114 Perkotaan

Asahan I

115 Cinta Dame/G. Maju

116 Purwodadi

From R&U

117 PayaSordangll

118 Mompang

119 Sidulang

120 Sigodung

121 Uratan

Ill Maluku ProvinceI Kairatu I

2 Way Bini

3 Way Lata

4 Way Meten

5 Way Geren

Total (141 schemes)

* Financed by Bank loan and Central Government budget, according to EOM standard# Financed by local government (province and district), according to EOM standard= Financed by local government (province and district), sufficient for routine operation only.+ Financed by Central Government, according to EOM standard

Appendix 3

LOCATION OF TERTIARY DEMONSTRATION UNITS

TDU No. of IrrigationProvince District Name Area (ha) Farmers Scheme

North Sumatra Deli Serdang 1. Namorambe 62.7 75 Namorambe2. Pulau Gambar 92.0 135 Pulau Gambar3. Sidodadi Ramonia 135.2 220 Sidodadi Ramonia4. Pekan Dolak 70.0 57 Pekan Dolak

Simalungun 5. Totap Majawa 70.0 82 Totap Majawa6. Kampung Baru Kerasaa 40.5 50 Kampung Bath Kerasaa7. Ps. Baru Uj. Bandar 61.0 65 Saribu Jawa8. Bahal Gajah 61.0 70 Bahal Gagah9. Dolok Hataran 55.0 60 Dolok Hataran

Asahan 10. Serbangan 107.0 132 Serbangan11. Sei Balai 135.0 150 Sei Balal

Tapanuli Utara 12. Silambanua 78.0 78 Silambanua13. Aek Mandosi 80.0 85 Aek Mandosi14. Hasak I 59.0 60 Hasak

T. Tengah 15. Badiri Lopian 101.0 110 Badiri Lopan

1. Selatan 16. Padang Sibio-bio 120.0 135 Pakang Sibio-bio17. Bandar Sipolu-polu 120.0 140 Bandar Sipolu-polu

Nias 18. Ndra Humene 71.0 80 Ndra Humene

Aceh Aceh Besar 1. Lamgeu Tuha 56.6 236 Krueng Jreue2. Meunara 54.6 214 Kureng Jreue

Pidie 3. Pelandok Tengoh 69.0 92 Trieng Gading4. Pub Lhok 58.0 105 Meuredu5. Meunasah Kuta 52.0 88 Beuracan

Aceh Utara 6. Lheu Simpang 71.0 120 Pandrah7. Ulee Jembatan 40.0 168 Batee Iliek8. KayeePanyang 80.0 117 Krueng9. Matang Peusangan 69.0 110 Alue Ubai

Aceh Utara 10. Ulee Jalan 90.0 Jeuram11. Simpang Peut 108.0 Jeuram

Aceh Selatan 12. Durian Kawan 46.4 Paya Dapur13. Drien Jab 58.6 Tangan-Tangan14. Teladan I 78.5 Babah Rote

Maluku MalukuTengah 1. Way Bini 53.0 170 Way Bini2. a. Way Kasar 65.5 56 Way Meten

b. Mako 68.4 61 Way Meten3. Way Geren 96,6 80 Way Geren4. Kairatu 94.3 124 Kairatu5. Samal 51.2 n.a. tobeconstructed

Halmahera Tengah 6. Mancalele 106.0 n.a. to be constructed

31

Appendix 4

..QCATION OF SEED MS

Location District Seed Farm a Commodity b

Aceh PidiePidiePidieAceh BesarAceh UtaraAceh BaratAceh Selatan

BBI KeumaleBBU MeureuduBBU ParuBBU SamahaniBBU PeudadaBBU Pub beBBU Tangan-Tangan

RiceRicePalawija/Horticultur€RiceRiceRiceRice

North Sumatra Deli SerdangSimalungunTapanuli UtaraTapanuli UtaraTapanuli SelatanTapanuli SelatanNias

BBI Padi MumiBBb Marihan/NauliBBP SibaraniBBP Gabe IBBP Sitongkon BalangkaBBP SipalangkaBBP Gido

RiceRiceRice/PalawijaRice/PalawijaRiceRiceRice/Palawija

Maluku

Matuku Tengah

BBI Kairatu (Seram)

RiceMaluku Tengah

BBU Mako (Buru)

Rice

Maluku Utara

BBI Jaibobo (Ternate)

Palawija

a BBI - Balai Benih Induk/Central Seedfarm.BBP - Balai Benih Pembantu/Supplementary Seedfarrn.BBU - Balai Benih Utama/Main Seedfarm.

b Palawija - Non Rice Crop.

32Appendix 5, page 1

DETAILED PROJECT COST ESTIMATES

Tabel 1: Project Cost By Component(S 000)

Actual vs.

I t e m Appraisal Actual AppraisalForeign Local Total Foreign Local Total (%)

A. Irrigation Deve4opment (DGWRD)1. CivilWorks

a. Rehabilitation and Upgrading 26,140 25,833 51973 32,227 38,411 70,638

b. Special Maintenance 1,617 1,434 3,051 1,444 1,444 2,888

c. Building and Offices 690 1,035 1,725 1068 1,742 2,810

2. Equipment 1,788 241 2,029 .0 1,827 1,827

3. Consulting Services 7,559 12,146 19,705 7,913 9,273 171864. Training 120 1,291 1,411 126 1,869 19955. Survey and Investigation 0 1,631 1,631 0 3,228 3,2286. Incremental O&M Cost 0 3,299 3,299 0 3,230 3,2307. Land Acquisition 0 3,322 3,322 0 1,752 1,7528. Administration 0 3,497 3,497 0 8,945 8,945

Subtotal 37,914 53,729 91643 42,778 71,721 114,499 125

B. Agriculture Development (DGFCH)1. CivilWorks

a. Land Development 0 959 959 21 28 48b. Seed Farm Improvements, TDUs 132 484 616 446 614 1,060

2. Equipment 1,087 466 1,553 864 1,076 1,9413. Consulting Services 1,439 902 2.341 3,716 97 3,8134. Training/Demonstration 162 1,216 1,378 432 579 1,0115. Administration 0 274 274 53 719 772

Subtotal 2,820 4,301 7,121 5,532 3,113 8,645 121

C. Land Tax Improvement (DGT)1. Mapping, etc. 0 4,582 4,582 0 5,469 5,4692. Equipment 195 7 202 178 0 1783. Consulting Services 335 70 405 113 177 2904. Training 0 45 45 0 46 465. Administration 0 210 210 0 182 182

Subtotal 530 4.914 5,444 291 5874 6,165 113

0. IrrIgation Service Fee (DGPARA)1. Equipment 0 0 02. Consulting Services 672 432 1,1043. Administration 0 34 34

Subtotal 672 466 1,138 na.

E. Contingencies 6,736 19,056 25,792

F. Taxes 0 10,500 10,500 0 10,447 10,447 99

G. Interest During Constructiona. The Bank 9,200 0 9,200 9,340 0 9,340

b. Government of Netherlands 300 0 300 0 0 0

Subtotal 9,500 0 9,500 9,340 0 9,340 98

Grand Total 57,500 92,500 150,000 58,613 91,622 150,235 100

22,454 16,703 6,424

1,851 1,200 0

848 804 73

986 742 301

7,681 6,794 3,515

770 425 216

740 696 182

2,541 694 64

1,455 1,261 485

1,573 1,173 450

40,899 30,492 11,710

45,581

3,0511,7252,029

727 18,7171,4111,6183,2993,2013,196

727 83,828

20,179 27,300 9,307 13,852

2,108 780 0 0

1,571 1,005 234 0

938 684 197 0

5,468 5,643 4,258 1,444

758 715 504 18

1,309 1,582 338 0

2,256 903 72 0

1.041 0 84 628

4,590 3,281 824 250

40,217 41,892 15,817 16,192

0 70,6380 2.8880 2,8108 1,827

373 17,1660 1,9950 3,2280 3,2300 1,7520 8,945

382 114,499

436 378 145

317 254 45

820 565 168

924 922 495

729 510 139

129 105 40

3,355 2.734 1.032

3,273 1,091 218

85 85 32

256 95 54

18 18 9

145 52 13

3,777 1.341 326

12.309 8,483 3,262

4,760 3550 1,270

4,100 3.300 1,100

69,200 49,900 18,700

0 0 0 0

1.104 0 0 0

34 0 0 0

1,138 0 0 0

0 0 0 0

3,809 3,785 1,322 1.441

3,717 3,363 1,121 1,074

56,443 53,055 20,105 18,707

0

48118

1,060209

1,941593

3,813308

1,011160

772

1,388

8,645

0 5.4690 1780 2900 460 182

6.165

0 0

0 1.104

0 34

0 1.138

0 0

90 10,447

65 9,340

1,925 150,235

959 0 48 0 0

616 504 298 141 0

1,553 817 609 306 0

2,341 1,277 1,093 850 0

1,378 356 253 94 0

274 301 206 104 0

7,121 3.255 2.507 1,495 0

4,582 3,905 1,302 263 0

202 75 75 28 0

405 183 68 39 0

45 18 18 9 0

210 126 45 11 0

4,307 1,508 350 0

113 24,167

60 9,640

100 8,600

1,000 138,800

33

Appendix 5, page 2

Table 2: Project Cost By Area(S '000)

Appraisal Actual - -Item

North Project North Teluk ProjectSumatra Aceh Maluku Guid. Unit Total Sumatra Aceh Maluku Lada Guid. Unit Total

A. Irrigation Development (DGWRD)1. Civil Works

a. Rehabilitation & Upgradingb. Special Maintenancec. Building & Offices

2. Equipment3. Consulting Services4. Training5. Survey & Investigation6. Incremental O&M Cost

7. Land Acquisition8. Administration

Subtotal

B. Agriculture Development (DGFCH)1. Civil Works

a. Land Developmentb. Seed Farms Improvements, TD

2. Equipment3. Consulting Services

4. TrainingiDemonstration5. Administration

Subtotal

C. Land Tax Improvement (DGT)1. Mapping etc.2. Equipment3. Consulting Services4. Training

5. Administration

Subtotal

D. Irrigation Service Fee (DGPARA)1. Equipment2. Consulting Services3. Administration

Subtotal

E. Contingencies

F. Taxes

G. Interest During Construction

Grand Total

12,859 14,501 27,360

1,444 1,444 2888

1.068 1,742 2810

0 1,827 1,827

7,913 9,273 17,186

126 1,869 1,995

0 3,228 3.228

19,368 21,517 40,885

2,393 7,064 9,457

289 289

281 281

183 183

927 927

13 13

323 323

993 323 1,315

1,752 1,752

8,945 8,945

14,083 9,402 23,485

32,227 45,475 77,701

1,444 1,733 3,177

1,068 2,023 3,091

0 2,010 2,010

7,913 10,200 18,113

126 1,881 2,008

0 3,551 3,551

0 3,553 3,553

0 1,752 1,752

0 8,945 8,945

42,778 81,123 123,901

5106194

10101

648

648 416

5471818

5182

182 587

5 21 32 53

106 446 720 1,166

194 864 1,270 2,135

10 3,716 106 3,822101 432 680 1,112

648 53 719 772

1,064 5,532 3,529 9,061

547 0 6,016 6,016

18 178 18 196

18 113 194 308

5 0 51 51182 0 182 182

769 291 6,461 6,752

1,740 1,740 7,600 7,600

1,740 1,740 7,600 7,600

26,019 34,444 60,463 27,259 29,446 56,705

40 38

40 40

2,237 2,237

23,410 33,884 57.294 19,368 23,754 43,122

0 0 0

21 28 48

12 31 43

435 583 1,018

62 0 62

802 1,076 1,878

123 97 219

3,593 0 3,5930 0

432 579 1,0110 0

53 71 124

197 128 325

5,335 2,338 7,673

5,469 5,469178 0 178113 177 290

46 460

291 5,692 5,983

0 0

672 432

672 432

043

34

34 43

0 0 0 043 672 475 1,14734 0 34 34

77 672 509 1,181

5,335 2,338 7,673

5

5

14,947 10,447 25,395

17

15

9,340 0 9,340

n.a. n.a. 0

9,340 0 9,340

58,613 91,622 150,235

01.104

1,104

PROJECT FINANCING SCHEDULE($ 000)

Indonesia

A. Irrigation Development (DGWRD)1. Civil Works

a. Rehabilitation & Upgradingb. Special Maintenancec. Building & Offices

2. Equipment3. Consulting Services4. Training5. Survey& Investigation6. Incremental O&M Cost7. Land Acquisition8. Administration

Subtotal

B. Agriculture Development (DGFCH)1. CivilWorks

a. Land Developmentb. Seed Farms Improvements,TDU

2. Equipment3. Consulting Services4. Training/Demonstration5. Administration

Subtotal

C. Land Tax Improvement (DOT)1. Mapping,etc.2. Equipment3. Consulting Services4. Training5. Administration

Subtotal

0. Irrigation Service Fee (DGPARA)1. Equipment2. Consulting Services3 Administration

Subtotal

L Interest During Constructiona, The Bankb. Government of The Netherlands

Subtotal

Grand Total

Actual Financing (percent)

Planned Financing (percent)

tJi

4'

gd

PROJECT IMPLEMENTATION SCHEDULE

A. Irrigation Developmer1. Rehabilitation and I

a. Survey and Desi

b. Construction

2. Special Maintenanca. Survey and Desi

b. Construction

3. Efficient Operation

4. Handing Over of Sia. Survey and Desi

b. Construction

c. Handing Over

5. Institutional Strengt

B. Irrigation Service Fee

C. Agriculture Developmi1. Land Development2. Tertiary Demonstr

3. Improvement of Se

4. Institutional Strengt

D. Land Tax (PBB)1. Survey and Mappir

2. Reclassification

Appraisal

CONTRACT DATA OF R&U SUBPROJECTS

Contract Value (Including Tax) Cost Overrun Start Completion Date Delay

Site/Scheme Original Final Percent Area Cost per ha(Rp) (Rp) Rp (ha) (Rp) Date Original Final (Months)

North Sumatra

Sample Schemes

1 Sidulang 1695,002,142 2,102833493 407,831,351 24 580 3,625,575 31Jan89 3Jan91 14Jan91 0

2 Sigodung 1,150,000,000 2,008,949,072 858,949,072 75 377 5,328,777 12Dec88 21 Dec90 9Jan93 25

3 Uratan 573,000,864 630,216,901 57,216,037 10 230 2,740,073 12 Dec88 25 Nov90 16 Dec91 13

4 Mompang 802,500,000 978,599,125 176,099,125 22 292 3,351,367 5Jan89 25Nov90 11 Nov91 12

5 Paya Sordang I 2,144,902,834 3,585,243,834 1,440,341,000 67 1,055 3,398,335 26 Jan89 29 Dec91 30Oct92 11

Paya Sordang II 2,446,463,479 3,542,837,377 1,096,373,898 45 14Jan89 3 Mar91 2 May92 14

Phase I

6 Aek Sibundong 1,537,571,000 1,755,653,900 218,082,900 14 602 2,916,369 3 Mar93 22Feb94 17Aug94 6

7 Sikoling-koling 1,506,429,000 1,743,107,300 236,678,300 16 543 3,210,142 3Sep92 22Feb94 22 May94 3

Paya Sordang - Pkg VU 1,665,566,000 1,867,252,000 201,686,000 12 3,295 566,693 14Sep92 28Feb94 30Aug94 6

Paya Sordang - Pkg VIII 2,295,009,000 2,667,509,000 372,500,000 16 14 Sep92 28 Feb94 26Apr94 2

Paya Sordang - Pkg IX 2,340,698,000 2,404,026,000 63,328,000 3 14Sep92 28 Feb94 27 AUg94 6

Paya Sordang - Pkg X 1,785,062,000 1,789,381,000 4,319,000 0 14Sep92 28 Feb94 27 Aug94 6

8 Gido Zebua I 2,299,123,069 2,574333000 275209,931 12 1,350 1906,913 12Sep92 3 Mar94 17 Aug94 6

Gido Zebua II 2,414,858,000 2,474,939,860 60,081,860 2 12Sep92 3 Mar94 2 May94 2

9 Siah Tukka 1,470,756,000 2,077,814,200 607,058,200 41 1,057 1,965,766 25Feb93 15Jun94 15Sep94 3

10 Badiri Lopian 1,266,156,000 1,518,040,206 251,884,206 20 1,200 1,265,034 3 Mar93 15Jun94 15Aug94 2

11 S/au Maraja & 2,117,623,000 2,650,247,000 532,624,000 25 1,715 1545,334 3Mar93 6Jul94 6Jul94 0

Sel Balai

12 Serbajadi & 1733,838,000 2,074,198,000 340,350,000 20 1,283 1,616,678 3 Mar93 14Jul94 14Jul94 0

Panca Alga

13 Padang SibioBio & 1,117,000,000 1,328,334,300 211,334,300 19 870 1,526,821 2Apr93 5Jul94 21 Aug94 2

Ponampuan

14 Arse & 1,457,775,000 1,672,145000 214,370,000 15 1,014 1649,058 2Apr93 25Jun94 25Aug94 2

Aek Silo

15 Serbangan 3,409,175,000 3,707,610,500 298,435500 9 2333 1,589,203 24Apr93 23Aug94 23Aug94 0

Total (Av.) 37,228,508,388 45,153,271,068 7,924,762,680 21 17,796 2,537,271

I—I

2,020 1,881,479

715 6,507,692

396 1,464,646

931 1,421,029

750 2,735,745

4,812 4,467,385

30

0

(0)

0000

0

(1)0

0

00

0

0

4

9

4

3

005

7

110

0

3

0

0

Contract Value (Including Tax) Cost Overrun Start Completion Data DelaySitelScheme Original Final Percent Area Cost per ha

(Rp) (Rp) Rp (ha) (Rp) Date Original Final (Months)

Aceh

Sample Schemes

1 Paya Dapur 2526000000 3961096,000 1,435096,000 57 960 4,126,142 24Jan89 24Feb91 28-Feb-92 12

2 Panga Pucuk 1,750,000,000 2,357,643,000 607,643,000 35 400 5,894,108 24Jan89 24Feb91 20-Jan-92 11

3 Babah Rote 2,239,000,000 3,570,479,000 1,331,479,000 59 1,050 3,400,456 24Jan89 24Feb91 30-Dec-91 10

4 Beuracan 1,851,000,000 3,462,624,000 1,611,624,000 87 840 4,122,171 24Jan89 24Feb91 31-Dec-91 10

5 Tangan Tangan 2,032,000,000 3,665,669,000 1,633,669,000 80 710 5,162,914 24Jan89 24Feb91 30-Nov-91 9

Phase I

6 Kr Geupu 858,000,000 1,028,337,000 170,337,000 20 161 6,387,186 25Feb91 25Sep91 24-Dec-91 3

7 Bungong Tab 1,060,000,000 1,253,491,000 193,491,000 18 426 2,942,467 25Feb92 25Jul92 25-Oct-92 3

8 Krueng Jreue 3,471,000,000 3,579,165,000 108,165,000 3 2440 1,466,871 21 Feb92 19Feb94 15-Aug-94 6

Krueng Jreue lb 2,485,000,000 2,874,784,000 389,784,000 16 27Apr92 28 Mar94 15-Aug-94 5

Krueng Jreue III 2,255,000,000 2,691,193,000 436,193,000 19 21 Feb92 19Feb94 25-Jul-94 5

9 Krueng Susoh I 9,297,000,000 11,907,424,000 2,610,424,000 28 2,100 5,670,202 14Mar92 6Sep94 06-Sep-94 0

Krueng Susob II 2,648,000,000 3,845,665,000 1197,665,000 45 14Mar92 21 Mar94 21-Aug-94 S

Krueng Susoh III 2,286,000,000 3,407,147,000 1,121,147,000 49 14Mar92 21 Mar94 21-Jun-94 3

Krueng Susoli IV 1,886,000,000 2,535,464,000 649,464,000 34 7 Mar92 24Feb94 24-Aug-94 6

10 Gunung Pudung I 3,499,000,000 3,532811,000 33,811,000 1 2,246 1,572,935 21 Mar92 10 Mar94 24-Aug-94 6

Gunung Pudung II 2,369,000,000 2,837,906,000 468,906,000 20 21 Mar92 10Mar94 23-Aug-94 6

Gunung Pudung III 1,918,000,000 2,307,965,000 389,965,000 20 7 Mar92 24Feb94 24-Aug-94 6

Gunung Pudung IV 2,374,000,000 2,373,705,000 (295,000) (0) 10 Mar94 24 Sep94 25-Oct-94 1

46,804,000,000 61,192,568,000 14,388,568,000 31 11,333 5,399,503Tot a I (Av.)

Maluku

1 Way Meten - Weir

Way Meten - lrr. & Drain

Way Meten - Tertiary

Way Meten-Add'I Works2 Kairatu - Weir

Kairatu I - Main systemKairatu-Tertiary systems

3 Way Bini - Main system

Way Bini - Tertiary4 Way Lata - Main system

Way Lata - Tertiary

Way Lata - Add'I Works5 Way Geren - Main

Way Geren - Tertiary

Way Geren-Add'l Works

Total (Av)

2,932,276,508

3,247,419,000

1,153,116,000

482,275,0004,653,000,0001,318,226,000

403,696,000

580,000,000

217,571,0001,322,978,444

721,539,000

513,054,0002,051,809,000

581,036,000

453,000,000

20,630,995,952

3,800,587,000

3,247,419,000

1,152,865,000

482,275,0004,653,000,0001,318,226,000

403,696,000

580,000,000

215,571,0001,322,978,444

721,539,000

513,054,0002,051,809,000

581,036,000

453,000,000

21,497,055,444

868,310,492

0

(251,000)

0000

0

(2,000,000)0

0

00

0

0

866,059,492

12Apr89

25 Jun 92

27 Feb93

4 May9414Oct9215May913 Sep 92

14Jun91

8 Dec927 Dec 92

31 Aug 93

5May9416Nov92

31 Aug93

4 May 94

10 Jun 92

31 Oct93

25 Feb94

31 Aug9417 Nov 9415May922 May93

14 Feb92

16Mar936 Dec 93

31 May94

1 Sep 9414 Nov 93

31 May94

31 Aug94

22-Mar-93

12-Feb-94

26May-94

31-Aug-9417-Nov-9409, Oct-9217-May-93

19-Sep-92

30-Jan-9406Dec-93

31-May-94

01Sep-94304an-94

31-May-94

31-Aug-94

Contract Value (including Tax) Cost Overrun Start Completion Date DelaySite/Scheme Original Final Percent Area Cost per ha

(Rp) (Rp) Rp (ha) (Rp) Date Original Final jMonths)

Teluk Lada

Cilemer Left

Kadubera Access Road 979346000 999077,000 19731000 2 11 Jul 89 2 Mar89 28 Feb89 0

Main & Sec. Systems

LMR-Il 2,617,058687 2,991,948000 374,889,313 14 7Jun90 29Jan92 30Apr92 3

LMR-IlI 1758,771,000 2,034,991000 276,220,000 16 10Dec90 30Jul92 27Mar93 8

Secondary Drain

LMR-DR.l 390000,000 404,999,970 14,999,970 4 7 Apr90 16 Oct90 22 May91 7

LMR-DRll 395,133,000 395133,000 0 0 23 Mar91 18Aug91 8Oct91 2

Tertiary Systems

LMR-T-1 404,149,000 404,149,000 0 0 1 Feb90 15Jul90 20Apr91 9

LMR-T-Il 177239,000 186,738,936 9,499,936 5 27Jan90 18Jul90 13Oct90 3

LMR-T/92 835,000,000 959,303,000 124,303,000 15 12Sep92 26Feb93 19Oct93 6

Inspection Road

LMR-IR/92 20 Km 691,150,000 794,550,000 103,400,000 15 15Sep92 12Mar93 27Oct93 8

2 Ciliman Left -

Munjul Access Road 1,494,871,000 1,494,871,000 0 0 16Jul88 8 Mar89 5Jun89 3

Main & Sec. Systems

LMN - II 2,989,109,000 3,491,279,957 502,170,957 17 23 May90 12Jan92 30Apr92 4

LMN - III 2,899,001,000 3,087,919,000 188,918,000 7 13Dec90 3Aug92 6Sep93 13

LMN - IV 2,768,000,000 3,019,096,000 251,096,000 9 10Dec90 27Jul92 22Feb93 7

LMN - V 2,792,400,000 2,792,400,000 0 0 4Sep91 26Apr93 23Jan94 9

LMN - VI 2,772,064,000 3,588,425,000 816,361,000 29 27Feb92 17Oct93 15Jan94 3

Secondary Drain

LMN - DR.I 1,323,993,000 1,565,993,000 242,000,000 18 22 May91 24Jun92 2Jan93 7

LMN - DR II 979,845,000 999,744,000 19,899,000 2 29Jun91 30Jun92 29Sep92 3

Tertiary Systems tb

LMN - I - I 233,549,000 233,549,000 0 0 27Jan90 15Jul90 31 Jul90 1

LMN - I - II 314,453,000 314,453,000 0 0 15 Feb90 15Jul90 11 Apr91 9

LMN - T - III 176,538,000 176 538,000 0 0 27Jan90 15Jul90 12 Mar91 8

Inspection RoadLMN - IR/92 841,028,000 966 234,000 125,206,000 15 12Sep92 3 Mar93 16Oct93 8

Total (Av.) 27,832,697,687 30,901,391863 3,068,694,176 11 7,334 4,213,443

39

Appendix 9

DETAILS OF INSPECTED R&U SUBPROJECTS

Aceh North Sumatra Maluku

.2 .Item

a .c a. . I-.a, 0 ' Ca Ca ._ 0 > >.E c . . ,__________________ (3 U) - O 0 0. m 0 (I) Q) U)

I. Physical InfrastructureA. Head Works

1.WeirCondition 1 11 1 1 3 1 1 1 1 1 1 1

2. Intake and Operation Gear Functionala. Structural and Mechanical 1 1 1 2 1 1 1 1 1 1 1 1 1 1 1 1 1

bI-lydraulic 32biii1113ii12j_!

3. Stilling Basin -a.Structural - c 1-- 11- 1--- 11- i- -b. Hydraulical - 1 - - 1 1 - 1 - - - 3 3 - 1 - -

B. Main and Secondary Canals1.CanalCapacityAdequate 1 1 1 1 1 2 1 1 1 1 1 1 1 1 1 2 1 1

2. Canal Lining in Good Condition 1 1 1 2 3 1 2 1 2 1 1 2L_1 1 1 1 2 2

3.EarthworkinGoodCondition 1 1 2 1 iJi 1 1 3 1 1 2 1 1 1 1 1 2

4. Structures arid Gates in Good Condition 1 1 1 1 1 1 1 1 2 2 1 1 1 2 1 1 1 1

5. Offtakes and Cross Regulators Functional 1 1 1 1 1 1 1 1 1 1 1 1 1 3 3 2 1 1

6. MeasurementSfructures Calibrated 3 2 3 3 1i 1 3 3 3 3 3 3 ili 3 3 3

C. Tertiary and Quaternary Canals1 . Tertiary Canals in Good Condition 2 2 2 3 2 3 1 3 1 1 1 1 2 2 2 1 2

2. Tertiary Intake in Good Condition 1 1 11 31 1 1 2 1 iLjliJi 1 i 1 1

3.QuaternaryCanals Present 3 3 2 2 3 3 3 3 3 3 1 2 2 3 2 2 2 2

D. Drainage Canals and Structures - - - - jj - - - -1.Extensive & Adequate Main Drainage 1 1 1 1 1 1 1 1 2 1 1 2 1 2 2 2 1 1

System Present2. Extensive Tertiary and Quaternary 2 2 2 2 2 2 2 3 2 2 2 3 2 3 3 2 2 2

Drainage System Present

II. InstitutionalA. WUAS

1.SK Bupati issued 3 3 3 1 1 1 3 3 3 1 1 1 3 3 3 3 3 3

2.AreWUAsregistered 3 3 3 33333 3 3 3 3 3 3 3 3 3 3

3.HaveWUAsbeentrained iH 111111333 133.4i13

4. O&M condition of Tertiary Unit 2 3 3 2 2 2 3 3 3 j .j _J _ _!I_! _i _

• Main course of river shiftedRemains of coffer dam prevent proper functioning of bottom vanes

C RedundantIntake canal to be reconstructed after major flood

• No data on water availability

Legend:1 = Satisfactory/yes2= Marginal3 Unsatisfactory/no

40

Appendix 10, page 1

STATUS OF COMPUANCE WITH LOAN COVENANTS

Timing

Schedule Present Status

After projectcompletion

31 Dec each year

1 month after end ofeach quarter

3 months aftercompletion of theProject

31 Dec87

30 Jun 88

31 Dec88

During ProjectImplementation

31 Mar88

Reference to LoanDocuments (SpecialOperations)

1. Article IVSection 4.02

2. Article IVSection 4.06 (b)

3. Article IVSection 4.07 (b)

4. Article IV

5. Schedule 6, para. 3

6. Schedule 6, pam. 5

7. Schedule 6, para. 5

8. Schedule 6, pam. 8

9. Schedule 6, pam. 10

Covenant

Gov't to provideamong othersadequate O&M funds

EAs to furnish auditedaccounts not later thannine (9) months aftereach related fiscal year

EAs to furnishQuarterly ProgressReports

EAs to furnish ProjectCompletion Report

Establishment of aProject Guideline Unit(PGU) within DGWRD

Restructuring of thePRIS in Aceh

Each PAlS to de-signate a ProjectManager

Reassignment and/orrecruitment of ad-ditional staff, asrequired, in eachconcerned PRIS, dis-trict subdistrictirrigation service

Establishment of the1SF Pilot Imple--mentation Unit underthe Simalungun Dis-trict IrrigationCommittee

Not complied with,O&M budget does notcover EOM require-ments.

Audited accounts for FY1992/93 from DGPARAnot yet received; fromDG Tax received inBahasa Indonesia.

PGUs did not provideconsolidated progressreports; Reports wereseparately submitted bythe EAs for eachProvince. DGPARA andDGT did not complywith this covenant.

Apart from DGT eachEA complied.

Complied with,however, the unit wasnot so effective.

Complied with on 4May 1988.

Complied with.

Actions in this regardwere not sufficient. Thisholds in particular fordistrict and subdistrictfield staff.

Done; however, the unitis not functional.

10. Schedule 6, para. 16

11. Schedule 6, para. 16

12. Schedule 6, para. 35

13. Schedule 6, para. 38

14. Schedule 6, para. 40

15. Schedule 6, para. 41

16. Schedule 6, para. 42

17. Schedule 6, para. 45

18. Schedule 6, para. 47

QuarterlyCoordination Meeting

Partly complied with.Meeting at district andProvincial level wereirregular and in-frequent. Meeting atnational level happenedsporadic.

Within 3 years ofLoan Effectiveness

Within 1 year of LoanEffectiveness

FY 88/89 onwards

FY 88/891993-94

The Bank approved thefinal Action Plan in Feb1992.

Training program ap-proved by the Bank on28 Dec 1990.

Ongoing on about92,000 ha.

Complied with.

FY 88/89

Being complied withonwards

FY 88/89

Not complied with.onwards

Start FY 88/89

Complied wth, however,collection of 1SF notsuccessful.

41

Appendix 10, page 2

Reference to LoanDocuments (SpecialOperations)

Timing

Covenant Schedule Pr8eeflt Status -

Coordination andMonitoring of ProjectImplementation byBAPPENAS at the Na-tional level, BAPPEDAat the provincial level,and District lrr. Com-mittee at district level

Approval ofSubprojects

Formulation ofComprehensiveTraining Program

Introduction of EfficientO&M

Handing over sub-projects areas lessthan 500 ha to WUAs

Maintenance of FY87/88 level of O&Mfunding on all Govern-ment controlledschemes in theconcerned provinces

Increase in level ofO&M funding on allsubprojects whereefficient O&M hasbeen introduced

Establishment of an1SF Pilot area inSimalungun District,North Sumatra

Simplify and ra-tionalize proceduresfor funding irrigationO&M

FY88/89 BAPPENASIsonwards examining ways of

allowing need-based-budgets for O&M.

42

Appendix 10, page 3

Timing

Schedule Present Status

Prior to 31 Mar 86

During ProjectImplementation

31 Dec 88

Reference to LoanDocuments (SpecialOperations)

19. Schedule 6, para. 48

20. Schedule 6, para. 49

21. Schedule 6, para51(a)

Covenant

Establishment or re-activation of Provincialand District IrrigationCommittees

Establishment ofViable WUAs

Establishment of aPME Unit in each ofthe three provinces

Establishment com-pleted, however, com-mittees are not ef-fective.

Ongoing, legal aspectsare addressed underthe 2nd IntegratedIrrigation Sector Project- Loan No. 1296-INO

Done; however, onlyeffective in Aceh.

(I

ANNUAL DISBURSEMENT SCHEDULE BY CATEGORY

- Appraisal R.vp,,d FY 1998/89 FY 1989/90 FY 1990(91 F'Y 1991/92 FY 1982/93 FY 1993/94 FY 1994195 TotalCat.goy Aflocalion A9ocallen

SOR $ SDR $ SDR I SOR $ 806 $ SOS 9 SOS $ SOS 5 SOR 5 506 5Asian D.v.lopm.nt Funds:LOan 960(SF)-INO

/1 CiiIWorks(R&USpro1ects) 8,225,000 10,593,084 9,464,700 13,020,688 340,239 459,668 2,045,238 2.624,783 2,012,010 2.811.458 2,275,948 3.107,377 1,927,607 2,688,990 416,532 583,578 403,1l4 583,062 9.420,688 12,858,934/2 Cml Works (S&M &Sprojecls) 1,459,000 1,879,065 1,258,700 1,731,607 115,000 149.687 138.875 175272 0 0 0 0 99,810 137,387 79,041 109,575 595,454 871,836 1,026,180 1,443,787/3A IC: Cord Works (R&U Subprojecls) 9,056,000 11,663.340 10,987,000 15,114,932 383,673 518,369 2,589,772 3.322.047 1.918,439 2,554,118 2.361,740 3244,478 2,449,086 3,435,915 489.706 658,077 454,760 657,769 10,645,176 14,500,773J38 LC. CkslWorlrs (S&M Subproects) 1,453,000 1,871,337 1,258,700 1,731,607 115,000 149,697 136,875 175.272 0 0 0 99,785 137,387 79,541 109,575 595,402 872,321 1,026,113 1,444,252/4 Cm'rl Works PartA.4(Buiddmngs) 536,000 690,321 809,500 1,113,638 0 0 249,472 320.542 108,798 150,341 13453 18,186 16,890 23,533 179,184 249,077 210,939 305.999 778,726 1,067,688/5 Eqompnrerd-PartA 1,299,400 1,673,514 1,458,600 2,006,611 0 0 202,109 264.608 550,574 740,477 175,487 239,917 23,486 34,019 142,409 199,459 255,193 366,127 1,349.358 1,844,507/6 Consmm6mngSeraces- PartA 5.294,000 6,818,211 5,601,000 7,705.355 367,268 501,523 1,826795 2,349.743 1,665,350 2,291,181 833,698 1,130,119 549,503 776,160 342,107 480,352 26793? 384,093 5,852,738 7,913,471/7 Tramnmn- Part A 93,000 119,776 93,000 127,941 0 0 0 0 0 0 58,923 82,491 0 0 0 0 31,059 43,633 89,979 126,124/SA LC CmvmlWorksParlA.4(Bu08ng) 974.000 1,254,427 1,320,000 1,815,939 0 0 407,033 522,990 177,512 245,293 21.950 29,689 27,541 39,395 292,353 406,388 344,061 490,403 1,270,450 1,742,15888 IC: Slrvey S InvestIgatIon- PartA 757,000 974,950 2,493,900 3,430,885 0 0 359,530 459,996 39,622 56,898 369.806 500,555 445,243 617,992 741,692 1,032,671 322,169 427.516 2,278,062 3,095,6398C IC. Sravey & Investigation- Part Al) 896,000 1,153,970 281,100 388,712 0 0 0 0 0 0 0 0 0 0 0 0 62,072 91,410 62,072 91,410:8D LC ConsullngSer.sces- ParIA 9,711,600 12,507,695 6,910,300 9,506,573 248,786 339,934 1,833,547 2,355,481 749,932 1,033,691 1,157,562 1,592,795 1,343,303 1,892,099 694,353 873,106 463,813 699,479 6,521,296 8,886,585BE IC. Conso6mng Ser,ces - Part A1(d) 2,173,000 2,798,635 370,840 509,893 0 0 0 0 0 0 56,453 78,883 13,848 19,374 66,913 93,157 149,646 218,539 286,660 409,953

/8F IC Tramrsng- Part A 1,280,500 1,649,173 1,533,200 2,109,239 0 0 62,660 80,069 13,988 20,092 111,215 152,842 227,895 316,607 345,384 481,108 566,077 818,070 1,327,220 1 868,7889 Cid Works - Part 9 (Bmmn,m Island) 12,000 15,455 12,000 16,509 0 0 0 0 0 0 0 0 0 0 0 0 7,899 11,515 7,898 11515GA Eqompmor* - Part B )8un lolarrd) 52,500 67.615 52,500 72,225 0 0 0 0 0 0 11,912 16.460 0 0 17,684 25,262 14,040 20,691 43,636 62.413

. 00 Eqrapmerd - Part 0 88,600 114,109 88,600 121,888 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0I 1A Consu9jng Ser'nces 'Part B (Boru) 87,000 112,048 87,000 119,687 0 0 0 0 0 0 0 0 0 0 0 0 84,816 122.757 84.816 122,757lB Consr.Ing Sernces -Part 0 575,000 740,550 575,000 791,034 0 0 0 0 200,795 287,029 153,913 209.924 0 0 60,242 83,822 62,897 90,618 477,847 971,893ZA IC: CMlWorks(Part B- Bus) 33,000 42,501 33,000 45,398 0 0 0 0 0 0 0 0 0 0 0 0 21,353 31,134 21,353 31,134

:28 LC: Consulting S.rv.ces (Part B- Our 72,000 92,730 72,000 99.051 0 0 0 0 0 0 0 0 0 0 0 0 65,879 96712 65,879 96,712I2C LC: Training (Part B- Boru) 32,500 41,657 32,500 44.711 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 020 IC. Adnlrastratjon (Part B- Bus) 11,000 14,167 11,000 15,133 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 012E IC' ConsuInng Sernces - Part 0 260,400 335,373 310,760 427.516 0 0 0 0 110.572 159,746 74,345 101,375 0 0 54,510 76,090 65,405 94,483 304,032 431,697

3 Unalocated 913,500 1,176,508 230,300 316,826 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0'4 Interest Durrng ConstructIon (bC) 1,242,000 1,599,588 1.242,000 1,708,633 27 36 27.663 35.012 115,573 159.619 193,637 263,913 258,164 378.068 352,255 498.929 284 678 404.936 1,242,000 1,740,410

Total Loan 850(SF)-INO 48,587.000 60.000.000 46,587,000 64,090,228 1,569,993 2.119.242 9,877,559 12,685,als 7,661.395 10,620,443 7,900,043 10,768.925 7,491,951 10,495,925 4,333,469 5,060,226 5,348,659 7,712 003 44193079 60,462,580

)rd&nary Cap8al R.sourn.SI.oan 181-tNO

:1 Civil Works (R&U Sukprojects) 20,200,000 20,361,180 0 839.735 0 234,629 3,527,379 8,122,853 6,542,997 19,367.5922 IC, Cvnl Works (590) SlIrprojects 22,284,000 22,927,264 0 685,525 0 145.261 4,238,126 9,182,323 7,285.837 21,517 0723 - Part C 195,000 195,000 0 0 0 0 3,940 0 174,140 178 0804 /' Conso8rng ernlces - Part C 335.000 335,000 0 0 0 0 84,390 28 770 0 113,180'5A LC. P69 Mapping Part C 8,136,000 5,993,000 0 0 0 0 0 423,009 5,046,241 5,469.25058 LC: Consufting Sernces Part C 87.000 230,000 0 14,401 5 0 84,783 77,580 0 175,764SC LC: Trarrr.ng Part C 57.000 57,000 0 0 0 ' 0 0 46,005 0 45,005St LC: Incremental 0&M PartA 3,036,000 2,631,556 50.576 524,345 0 80,450 256,735 363,812. 961,338 2,237,256

Unalocaled ' 70,000 70,000 0 0 0 0 0 0 0V Interest Ounng Construction (bOC) 7,600,000 7,600,000 33,750 162,246 455,955 607,994 731,943 1,274.340 4,333,742 7,600,000

•. Total Loan 861-IntO 60,000,000 60,000,000 84,326 2,226,252 455,985 1,068334 8,627,295 19,498,592 24444,295 56,705,179

- Grand Total 120,000,000

124,090,228 2,203,568 14,912,067 11,076,428 11,837,259

19,423,221 25,558,918 32,156,298 117,167,759

44Appendix 12, page 1

Economic Analysis

A. Introduction

1. Economic analysis was undertaken for five sample subprojects in Aceh Province, for whichan analysis had been done during appraisal. The projects had been completed in late 1991 orearly 1992 and, therefore, have generated initial benefits. In addition, adequate information for aneconomic analysis is available for these five sample projects over the years of implementation andinitial operation, a situation that does not apply to the same extent to the other subprojectsundertaken. Even so, it is suggested that some of the assumptions made for the economicanalysis and the data used would benefit from revalidation during project audit.

B. Initial Benefits

2. In the initial years of operation of the five sample projects, rice production increased byabout 60 percent from about 14,500 tons (t) prior to the project to about 23,500 tin 1993. Thisès a significant achievement, even if in part compensated for by a decline in dry season cultivationof other crops, in particular groundnut from about 1,300 to about 600 t. The initial increase in riceproduction has, however, also to be compared with the expected production by the year 2000 orearlier, when adjustments in land use and production technology are expected to bring about aproduction of about 36,400 t, about two and a half times the preproject level of production. Withthe high cost of investment in rehabilitation incurred, the Economic Internal Rate of Return criticallydepends on the early attainment of projected yields and land use.

C. Economic Analysis

3. An economic analysis has been carried out for each of the five sample subprojects and istaken as indicative of the performance of other subprojects for which insufficient information wasavailable at the PCR Mission. The major assumptions underlying the analysis include thefollowing:

1. Project Costs

4. The economic costs of the subprojects include the costs of civil works, supervisoryconsulting services, and the incremental cost of production and O&M for the rehabilitated irrigationsystems. The foreign exchange costs were converted to rupiahs at the exchange rate prevailingat the time when expenditures were incurred. The conversion to 1994 constant values was basedon the G5-MUV Index. The current values of local costs were converted to 1994 constant valuesusing the annual consumer price index for Indonesia. Financial costs were converted to economiccosts using a conversion factor of 0.8 for labor and 0.9 for all other costs. Taxes and landacquisition costs, representing transfer payments, have been excluded. In the absence ofconclusive evidence on the future trend in the cost of farm labor in the project areas, the cost oflabor was assumed as constant over the 30-year life of the project.

45

Appendix 12, page 2

2. Commodity Prices

5. The economic prices of major agricultural inputs and outputs were derived from the WorldBank's Commodity Prices and Price Projections (July 1994). The derivation of economic pricesis shown in Tables 1 to 7. During the past few years, Indonesia has alternated exporting andimporting relatively small volumes of rice, a pattern which is expected to prevail over the life of theProject. Hence, the average parity price between import and export parity was used in theeconomic analysis.

3. Project Benefits

6. The benefits attributed to the Project are based on assumptions with regard to productionwith and without the Project. For the without-Project situation, in the absence of evidence to thecontrary, it has been assumed that pre-Project production levels fully reflected on-farm adjustmentsto severely degraded irrigation schemes and that production levels would remain constant. Thisassumption balances the possibility of further production declines with a further deterioration ofthe irrigation system, with the possibility of yield increases for basically rainfed agriculture, shouldsuch a technology be consciously pursued. The with-Project situation assumes the expansion inarea cultivated, in particular during the dry season, and yield increases during both croppingseasons from the adoption of higher yielding technology packages made possible by thecontrolled use of irrigation water (see Tables 8 and 9). One key assumption underlying theprojected benefits is the adoption of sound operation and maintenance practices thatwould ensurean economic life of 30 years as assumed. Continuation of past practices of deferred maintenancemay lead to a deterioration of system operations to pre-Project levels over a period of 10 to 15years. Rather than assuming developments to full technical potential, conservative assumptionshave been made with regard to full land use or yield levels, where developments to date indicatea slower adjustment process. These assumptions, potentially understating benefits, have to bereviewed during Project audit.

4. Economic Internal Rates of Return

7. The EIRRs for each of the five sample subprojects are shown in Table 10. The EIRRs rangefrom a low of 2.6 percent for the Babah Rote subproject (13.6 percent estimated at appraisal) toa high of 14.4 percent for the Tangan-Tangan sub-project. The EIRR for all five sub-projects takentogether has been computed at 8.3 percent. This is a low rate of return for a rehabilitation project,which would be expected to incur low costs on the basis of sunk costs for the original investmentto be rehabilitated. The relatively modest rates of return signify the following: (i) the need to adoptrehabilitation design and contract practices that would minimize investment costs, (ii) theimplementation of rehabilitation in a way that would minimize production losses during projectimplementation, and (iii) special attention to the provision of farm support services to acceleratethe process of on-farm adjustments in production technology and achievement of technicallyfeasible benefits.

46

Appendix 12, page 3

ECONOMIC ANALYSIS

Table 1: Economic Import Parity Price for Rice (1994 constant prices>

item Unit 1987 1988 1989 1990 1991 1992 1993 1994 1995 2000

Thai 5% broKen., FOB Bangkok(1) S/ton 210 301 320 287 314 287 242 315 345 332(Current price)

Qu$llyadjustmentlO% S/ton 189 271 288 258 283 258 218 284 311 299

Insurance and freight Mon 28 30 30 32 32 34 33 33 33 33

ValueCIF Indonesian port S/tot, 217 301 318 290 315 292 251 317 344 332

Excflange rate Rp/S 1650 1689 1767 1904 1989 2033 2095 2168 2168 2168

Value Current rupiah Rp/kg 358 508 562 552 626 594 526 687 746 720

ValUe 1994 ruplah Rp/kg 602 785 822 763 790 684 578 687 746 720

Port handling, storage, losses etc. towholesaler 6%(-s-) 36 47 49 46 47 41 35 41 45 43

Transpottwholesalerto project ares Rp/kg (-) 54 54 54 54 54 54 54 54

Traders margins 10% (-) 60 79 82 76 79 68 58 69 75 72

Subtotal: Ex-mil pre Rp/kg 524 700 736 678 704 602 501 606 662 638

Conversion topadl 65% 341 455 478 441 458 392 325 394 430 414

Milling cost Rp/kg (-) 40 40 40 40 40 40 40 40 40 40

Transport farm to mill Rp/kg (-) 20 20 20 20 20 20 20 20 20 20

Econom farm-gate price Rp/kg 281 395 418 381 398 332 265 334 370 354

(I) Sc..rr I98..,k CommrfrPWt. Fnm..tJ.4y 1994 F.rE.,l, R,.w (fo 1993 td 1994)

Table 2: Economic Export Parity Price for Rice (1994 constant prices)

Item Unit 1987 1988 1989 1990 1991 1992 1993 1994 1995 2000

Tha15%brol(ens,FOBBangkok(1) Mon 210 301 320 287 314 287 242 315 345 332(current pre)

Ouallty adjustment 15% Mon 179 256 272 244 267 244 206 268 293 282

Value FOB Indonesia S/ton 179 256 272 244 267 244 206 268 293 282

Exchange rate RpIS 1650 1689 1767 1904 1989 2033 2095 2168 2168 2168

Value current ruplah Rp/kg 295 432 481 464 531 496 431 580 636 612

Value 1994 rupiall Rp/lcg 495 667 704 642 670 571 473 580 636 612

Port handling, storage, oases etc. to 6% (-) 30 40 42 39 40 34 28 35 38 37wholesaler

Transport from project area Rp/kg (-) 54 54 54 54 54 54 54

Tradera margins 10% 50 67 70 64 67 57 47 58 64 61

Subtotal: Ex-mill price Rplkg 362 507 537 485 509 426 343 434 480 460

Conversion topadl 65% 235 329 349 315 331 277 223 282 312 299

Milling cost Rp/lcg (-) 40 40 40 40 40 40 40 40 40 40

Transport farm to mill Rp/lcg (-) 20 20 20 20 20 20 20 20 20 20

Economic farm-gate price Rp/kg 175 269 289 255 271 217 163 222 252 239

(I) Soeim: l9tetd Bes9 C.mresd.ly Pilr. J,iy 1984 .id F.,E.M.,,, Eonm R.'.'ww (824lr 1993 .nd 19941

47Appendix 12, page 4

Table 3: Average of Import and Export Parity of Prices of Rice (1994 constant prices)

Item Unit 1987 1988 1989 1990 1991 1992 1993 1994 1995 2000

(rr,ot1pentyncepnces Rp4cg 281 395 418 381 398 332 265 334 370 354

Exportpantyncepflces RpAcg 175 269 289 255 271 217 163 222 252 239

Averageeconorncricepctce RpMg 228 332 354 318 334 274 214 278 311 297

S. 0814148.44 Co.140od P44. 64.60809 .641994 Ind F.,E.dndn E88.o.,* R.nO.w (141893644 1994)

Table 4: Economic Import Parity Price of Groundnuts (1994 constant prices)

Item Unit 1987 1988 1989 1990 1991 1992 1993 1994 1995 2000

C&zrento&mutso4plice(1) S/ton §24 552 775 964 894 610 739 990 850 772

World pnce/domestic pnce rato 0.72

CIF)ndonesiasheUedgrou,uts S/ton 377 397 558 694 644 439 532 713 612 520

Exchangerate Rp)S 1650 1689 1767 1904 1989 2033 2095 2168 2168 2168

P4ceinniahs Rplkg 623 671 966 1322 1280 893 1115 1545 1327 1127

Pncesinttatedtol gg4va)ue(2) Rp4g 1047 1037 1444 1826 1615 1029 1224 1545 1327 1127

Port handling. storage, losses etc. towholesaler 6%(*) 63 62 67 110 97 62 73 93 80 68

Valueatwtiotesaler RpAcg 1110 1099 1530 1936 1712 1090 1297 1638 1406 1195

Transport wholesaler to project area RpAg (-) 54 54 54 54 54 54 54 54 54 54

Tradersnlargrns 10%(-) 105 104 144 183 162 103 122 155 133 113

Transport to tarn, Rp4cg (-) 20 20 20 20 20 20 20 20 20 20

Economicfan'n-gatepnce Rp/tcg 931 921 1312 1679 1477 913 1101 1410 1200 1008

Pricensshe(65%1arrngate} Rp4g 605 599 853 1091 960 594 715 916 780 655

(I) Sonc.' 1944108 8.98 Co9n.9dIly P44. P06P.919 Ju'y 1994

(2) In011ilon 1.).o 19.8:

III? III 110* 96*0 1*01 1692 1113 1114

89 5.47 5.91 953 9.52 4.94 5.77 --nd.. 1 682 1.544 464 1.302 262 I 52 1098 1.000

Table 5: Economic Export Parity Price of Urea (1994 constant prices)

Item Unit 1988 1989 1990 1991 1992 1993 1994 1995 2000

Urea price P09 Europe S/ton 131 132 157 172 140 107 134 140 177(bagged) (cun'erit prices) (1)

Pncedlfferental)ndonesjanurea 5(+) 18 18 18 18 18 18 18 18 18

FOB bagged ax factory S 149 150 175 190 158 125 152 158 195

Exchange rate Rp/$ 1689 1767 1904 1989 2033 2095 2168 2168 2168

Prlceincurreritrupoahs Rpkg 252 265 333 378 321 262 329 342 423

Pricesinflatedto l9g4vakie(2) RpMg 388 388 460 477 370 287 329 342 423

Handtir,g,storage.etc. Rpflcg 19 19 23 24 18 14 16 17 21

Transport to protect area RpIIcg (4') 54 §4 54 54 54 54 54 54 54

Traders margins 10% 39 39 46 48 37 29 33 34 42

Transportto farm Rpoicg(.) 20 20 20 20 20 20 20 20 20

Econonicfaron-gatevaie Rp,icg §21 520 603 622 499 404 453 468 560constant prices

(It 00i.n.: 845448.44 Co.#radt1 P44. P8.14.919 .61871994

Ill 1841.6.9 raIl 019.4:

1111 1699 11*1 1*81 1112 16*3 1114

5,47 0.97 9.53 9.52 494 917 —

8.0814 1.544 9.464 1382 1.262 1.152 1,098 1.00

Appendix 12, page 5

Table 6: Economic Import Parity Price of Triple Super Phosphate (TSP) (1994 constant prices)

Item Unit 1988 1989 1990 1991 1992 '1993 1994 1995 2000

TSPpnceFOBUSGuIt S/ton 124 144 132 133 121 112 132 135 163(bulk) (current Prices) (1)

Insurance and freight S (+) 45 48 48 51 52 54 54 54 54

ValueCiFlndonesia $ 169 192 180 184 173 166 186 189 217

Exchange rate Rp/S 1689 1767 1904 1989 2033 2095 2168 2168 2168

Price ri current rupiahs Rp/kg 285 340 343 365 351 348 403 409 470

Prices inflated to 1994 value Rp/kg 441 498 474 461 405 382 403 409 470

Handling, storage, etc. 5% 22 25 24 23 20 19 20 20 23

Transport to project area Rp/kg (+) 54 54 54 54 54 54 54 54 54

Traders' margins 10% 44 50 47 46 40 38 40 41 47

Transport to farm Rplkg (+) 20 20 20 20 20 20 20 20 20

Economic farm-gate value Rp/kg 581 646 619 604 539 513 537 545 614constant prices

(1) So,,ce: I*ld 8.nk Co,,,,r,edt Prtra Fo,ecavb Ju9. 1994

Table 7: Economic Import Price of KCL (1994 constant prices)

Item Unit 1988 1989 1990 1991 1992 1993 1994 1995 2000

KCL price FOB US Gulf S/ton 68 99 98 109 112 107 105 108 132(bulk) (current Pnces) (1)

Insurance and freight S (+) 45 48 48 51 52 54 54 54 54

ValueCiFindonesia $ 111 147 146 160 164 161 159 162 186

Exchange rate Rp/$ 1689 1767 1904 1989 2033 2095 2168 2168 2168

Price in current rupiahs Rp/kg 187 260 278 318 333 337 344 351 403

Prices inflated to 1994 value Rp/kg 290 381 384 401 384 370 344 351 403

Handling, storage, etc. 5% 14 19 19 20 19 19 17 18 20

Transport to project area Rp/kg (+) 54 54 54 54 54 54 54 54 54

Traders' margins 10% 29 38 38 40 38 37 34 35 40

Transport to farm Rp/kg (.s-) 20 20 20 20 20 20 20 20 20

Economucfarm-gatevalue Rp/kg 407 512 516 535 515 500 470 477 537constant prices

Ill Ser,c. i4Vfld Back Coeveedil), Pric. Forecast, Jsty 1994

49

Appendix 12, page 6

Table 8: Cropped Areas of Major Crops (ha)

Item 1989 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000& beyond

1 Beuracanwet season paddy

without project 761 761 761 761 761 761 761 761 761 761 761 761 761with project 761 761 761 761 761 761 761 761 761 761 761 761 761

dry season paddywithout project 426 426 426 426 426 426 426 426 426 426 426 426 426with project 426 426 0 114 761 761 761 761 761 761 761 761 761

2. Panga Pucukwet season paddy

without project 265 265 265 265 265 265 265 265 265 265 265 266 265with project 265 265 265 355 355 424 442 465 489 522 522 522 522

dry season paddywithout project 0 0 0 0 0 0 0 0 0 0 0 0 0with project 0 0 0 0 3 44 44 88 132 176 220 264 348

3. Babah Rotewet season paddy

without project 967 967 967 967 967 967 967 967 967 967 967 967 967with project 967 967 582 1.034 1,061 1,126 1,202 1,202 1,202 1,202 1202 1,202 1202

dry season paddywithout project 582 582 582 582 582 582 582 582 582 582 582 582 582with project 582 582 582 776 1.081 1128 1.022 1022 1,022 1 022 1,022 1,022 1022

Pa/awija jgroundnut)without project 336 336 336 336 336 336 336 336 336 336 336 336 336with prolect 336 336 336 259 0 0 0 0 0 0 0 0 0

4 Tangan-Tanganwet season paddy

without project 267 267 267 267 267 267 267 267 267 267 267 267 267with project 267 667 667 667 667 667 667 667 667 667 667 667 667

dry season paddywithout project 0 0 0 0 0 0 0 0 0 0 0 0 0with project 0 157 207 420 234 0 167 501 534 534 534 534 534

wet season pa/awijawithout project 67 0 0 3 0 0 0 0 0 0 0 0 0withproject 0 0 0 0 0 0 0 0 0 0 0 0 0

dry season palawijawithout project 334 334 334 334 334 334 334 334with project 334 174 167 187 334 327 174 100 33 0 0 0 0

5 Paya Dapurwet season paddy

without project 902 902 902 902 902 902 902 902 902 902 902 902 902with project 902 686 902 902 902 902 902 902 902 902 902 902 902

dry season paddywithoutproject 0 0 0 0 0 0 0 0 0 0 0 0 0with project 0 0 0 0 400 440 480 520 660 600 640 660 660

dry season palawijawithout project 280 280 253 334 334 334 334 334 334 334 334 334 334with project 280 280 253 334 0 0 0 0 0 0 0 0 0

Land development is expected to expand the cujtivated area within the command area of the rehabilitatedirrigation structures beyond the area cropped during Project Completion Report Mission.

Appendix 12, page 7

Table 9: Crop Yields (tlha)

Item 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000& beyond

1. Beuracanwet season paddy

withoutproject 5.1 51 5.1 5,1 5,1 5.1 5.1 51 5.1 51 51 51 5.1

with project 5.1 5.1 5.1 5.9 5.9 5.9 59 59 5.9 59 5.9 59 59

dry season paddywithout project 3.4 3 4 3.4 3.4 3.4 3.4 3 4 3 4 3.4 3 4 3,4 3.4 3 4

with project 3.4 34 00 3.4 40 4.5 5 1 5.6 5.9 59 5.9 5.9 59

2. Panga Pucukwet season paddy

without project 2.7 2.7 2.7 2.7 2 7 2.7 2.7 2.7 2.7 2.7 2.7 2.7 2.7

with project 2.7 2.7 2.7 2.7 3.6 3.8 38 39 3.9 4 0 4.1 4.2 4.3

dry season paddywithout project 0.0 0.0 0.0 0.0 0.0 00 00 0.0 00 0.0 0.0 0.0 00

with project 0.0 0.0 0.0 0.0 0.0 25 2.7 2.9 3 1 3.3 35 3.7 3.9

3. Babah Rotewet season paddy

without project 31 3.1 31 31 3.1 31 3.1 31 31 3.1 3 3.1 31

with project 3.1 3.1 31 I 9 2.5 2.1 3.7 40 43 4.6 46 46 4.6

dry season paddywithout project 2.9 2 9 2 9 2.9 2.9 2 9 2.9 2 9 2.9 2 9 2.9 2 9 2 9

withproject 2.9 3.5 39 2.2 3.1 35 3.8 40 42 42 42 4.2 42

Palawija (groundnut)without project 1.2 18 19 1.5 1.6 1.6 1.6 16 16 16 1.6 16 16

withproject 1.2 1.8 19 1.5 00 0.0 00 00 0.0 00 0.0 0.0 00

4. Tangan-Tanganwet season paddy

without project 3.0 3 0 3.0 3.0 3.0 3.0 3 0 3.0 3 0 3.0 3.0 3.0 3.0

with project 3.0 3 0 3.5 4 0 4 0 4 0 4 0 4.5 4 5 5 0 5.5 5.5 55

dry season paddywithoutproject 0.0 00 0.0 0.0 00 0.0 00 0.0 00 0.0 0.0 0.0 0.0

with project 0.0 3.2 32 3.3 3.4 34 3.5 40 46 4.6 4.6 4.6 46

wet season palawijawithoutproject 1 4 1.4 1.4 1 4 1 4 1 4 1.4 1 4 1.4 1 4 1 4 1 4 1.4

with project 1 4 0.0 0.0 0.0 0.0 0 0 0 0 0.0 0 0 0.0 0 0 0 0 0 0

dry season pa.lawija

withoutproject 1.4 1.4 1.4 1.4 1.4 1 4 14 1,4 1 4 1.4 1 4 1 4 1.4

with project 14 1.4 14 15 1.7 1.8 2.0 2.0 2.0 00 00 00 0.0

5 PayaDapurwet season paddy

without project 3.4 34 3.4 3.4 3.4 3.4 3.4 34 3.4 3.4 3.4 3.4 34

with project 3.4 3 4 3.4 3.4 3 4 3.6 4 1 4 5 5.0 5 0 5.2 5.2 5 2

dry season paddywithout project 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 00 0.0 0.0 0.0

with project 0.0 0.0 00 3.4 3.4 3.6 41 4.5 4.8 48 4.8 4.8 48

dry season palawija

withoutproject 1.14 114 114 114 1.14 1.14 114 114 1.14 1.14 1.14 114 114

with project 1.14 1.14 1,14 1.14 0.00 0.00 000 0.00 0.00 000 0.00 0.00 000

1599 191 3 235.5

52.9 529 52.9

0.0 00 0.0

212.8 2442 288.4

4229 4951 5978

210.1 2509 309.4

2698 280.6 3649

52.9 52.9 529

0.0 0.0 00

322.7 3335 3178

664.8 738 1 859.2

342,1 4046 541.4

EIRR: 10.5%

515,8 610.9 710.6 731.7 7558 766.6

81.9 81.9 81 9 81.9 81.9 819

12.0 0.0 00 0.0 0.0 00

609.7 692.8 7925 813.6 8377 648.5

840.2 1,025.2 1,143 9 1,152.2 11650 1,173 3

230.5 332,4 351 4 338.6 327 3 324 8

EIRR: 2.6%

51

Appendix 12, page 8

Table 10: Cost and Benefit Streams (Rp million), EIRRs

Item 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000& beyond

1 Beuracana) Incremental crop production cos 0.0 0.0 (325.3 ) (237.1 ) 430.3 4100 423.7 4284 432.8 4372 441.4 4463 4502

b) Incremental O&M • 0.0 34 175 40.7 62.2 777 777 777 77.7 77.7 777 777 777c) Investmentcost 172.0 704.0 11590 1,0760 773.0 0.0 0.0 00 00 0.0 00 0.0 0.0

Total incremental cost 172.0 707.4 851 2 879.6 1,265.5 487.7 501.4 5061 5105 514.9 5191 524.0 5279Incremental benefits 0.0 0.0 (480.6 ) (3543 ) 604.0 553.2 845.5 1.0642 1.1243 1,1133 1,102.4 1,095.1 1.0841

Net incremental benefit (172.0 ) (707.4 ) 1,311 8 ) 1,2339 ) (661.5 ) 65.5 344.1 5581 6138 598.4 583.3 571.1 5562

EIRR: 9.3/,

2. Panga Pucuka) Incremental crop prod. cost

b) Incremental O&MC) Investment cost

Total incremental costIncremental benefits

Net incremental benefit

3 Babah Rotea) Incremental crop prod. cost

b) Incremental O&MC) Investment cost

Total incremental costIncremental benefits

Net incremental benefit

00 0.0 00 28.1 63.9 113.2 125.5

0.0 0.0 130 32.6 47.4 52.9 52.90.0 684.0 977 0 737 0 285.0 5.0 0.0

00 684.0 9900 797.7 396.3 171 1 178.40.0 0.0 0.0 80.5 153.0 2166 302.9

0.0 (684.0 ) (9900 ) (717.2 ) (243.3 ) 45.5 1245

00 572 (15.2 ) 60 850 149.7 327.4

0.0 00 21.2 508 737 81.9 81.90.0 10610 1,447.0 1,161.0 4210 12.0 120

0.0 1,1162 1,483.0 1.2178 579.7 243.6 421 300 1236 (1786) (4495) 410 (362) 5002

0 0 (994 6 ) 1,661 6 ) 1,667 3 ) (538 7 ) (279 8 ) 78 9

4 Tangan-langana) Incremental crop prod. cost

b) Incremental O&Mc) Investment cost

Total incremental costIncremental benefits

Net incremental benefit

00 27.7 110.8 283.0 318.9 2103

00 00 26.9 544 844 8440.0 1,343 0 1,370.0 1,496 0 0 0 0 0

0.0 1,370.7 1,516.7 1,833.4 4033 29470.0 3427 340.0 8168 7334 4189

0.0 (1,028.0) 1,1767) 1,0156) 3301 1242

1692 324.8 336.5 3583 383.4 3933 404.9

844 844 844 844 844 844 844

00 00 0.0 00 00 0.0 0.0

253.6 4092 420.9 442.7 4678 4777 489.3

496.0 1,031 4 1,023.6 1,080.8 1,191 2 1,2048 1,2135

242.4 6222 602.7 6381 7234 7271 7242

EtRR: 14.04%

5 Paya Dapura) Incremental crop prod. cost 0.0 (78.1 ) 0.0 0.0 (1 4 ) 82.8 1652 2636 3937 4291 4824 506.4 5187

b) Incremental O&M • 0.0 00 297 528 745 922 922 922 922 92.2 922 922 922c) Investmentcost 0.0 1,4840 1,1540 1,087.0 885.0 00 00 0.0 0.0 00 0.0 0.0 00

Total incremental cost 0.0 1,405.9 1,183.7 1,1398 958.1 1750 2574 376.0 4859 521 3 5746 5986 6109Incremental benefits 00 (2577 ) 0.0 00 143.2 111 0 361 3 7122 9650 1,0275 1,143.6 1,179.3 1,181 7

Net incremental benefit 0.0 (1,6636 ) 1,183.7 ) 1,1398 ) (8149 ) (640 ) 1239 336.2 479.1 506.2 569.0 580.7 5708

EIRR: 6.9%

O&M cost estimated at 2.0 percent of cumulative investment cost, deferred by one year;ongoing O&M requirements for sunk cost of rehabilitation prolects are excluded.

Note 1' Figures in parentheses denote negative amounts

Note 2; At appraisal the following EIRRs had been estimated.Beuracan 12.4%Pangan Pucuk 8.0%Babah Rote 13.6%Tangan-Tangan 13.0%Paya Dapur 13.8%

Information in the Appraisal Report does not permitan assessment of causes for the variation of EIRRs.

22,454 16703 6,424

1,851 1,200 0

848 804 73

986 742 301

7.681 6,794 3,515

770 425 216

740 696 182

2,541 694 64

1,455 1,261 485

1,573 1,173 450

40,899 30,492 11710

45,5813,0511.7252,029

727 18,7171,4111,6183,2993,2013,196

727 83,828

20,179 27,300 9.307 13.852

2,108 780 0 0

1,571 1,005 234 0

938 684 197 0

5,468 5,643 4,258 1,444

758 715 504 18

1,309 1,582 338 0

2.256 903 72 0

1,041 0 84 628

4,590 3,281 824 250

40,217 41,892 15.817 16,192

436 378 145

317 254 45

820 565 168

924 922 495

729 510 139

129 105 40

3,355 2,734 1,032

3,273 1,091 218

85 85 32

256 95 54

18 18 9

145 52 13

3,777 1,341 326

959 0 48 0 0

616 504 298 141 0

1,553 817 609 306 0

2,341 1,277 1,093 850 0

1.378 356 253 94 0

274 301 206 104 0

7,121 3,255 2,507 1,495 0

4,582 3,905 1,302 263 0

202 75 75 28 0

405 183 68 39 0

45 18 18 9 0

210 126 45 11 0

5,444 4,307 1,508 350 0

0 0 0 0

1,104 0 0 0

34 0 0 0

1,138 0 0 0

0 0 0 0

3,809 3,785 1,322 1,441

3.717 3,363 1,121 1,074

56,443 53,055 20,105 18,707

12,309 8.483 3,262

113 24,167

4,760 3,550 1,270

60 9,640

4,100 3,300 1,100

100 8,600

69,200 49,900 18,700

1,000 138,800

33

Appendix 5, page 2

Table 2: Project Cost By Area(S '000)

Appraisal ActualItem

North Project North Teluk ProjectSumatra Aceh Maluku Quid. Unit Total Sumatra Aceh Maluku L.ada Quid. Unit Tol

A. Irrigation Development (DGWRD)1. Civil Works

a. Rehabilitation & Upgradingb. Special Maintenancec. Building & Offices

2. Equipment3. Consulting Services4. Training5. Survey & Investigation6. Incremental O&M Cost7. Land Acquisition8. Administration

Subtotal

B. Agriculture Development (DGFCH)1. Civil Works

a. Land Developmentb. Seed Farms Improvements, TD

2. Equipment3. Consulting Services4. TraininglDemonstration5. Administration

Subtotal

C. Land Tax Improvement (DGT)1. Mapping etc.2. Equipment3. Consulting Services4. Training5. Administration

Subtotal

0. Irrigation Service Fee (DGPARA)1. Equipment2. Consulting Services3. Administration

Subtotal

E. Contingencies

F. Taxes

G. Interest During Construction

Grand Total