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The Government of India and the World Bank signed here today, a loan agreement of US$325 million, to help India’s second largest State, Maharashtra in improving the productivity of its water resources. The agreement was signed in the presence of the World Bank President, Mr. Paul D. Wolfowitz and Finance Minsiter, Shri P. Chidambaram by Mr. Michael Carter, Country Director, India, Mr. Madhusudhan Prasad, Joint Secretary, Ministry of Finance and Mr. S. V. Sodal, Secretary (Water Resources), Government of Maharashtra.
Speaking at the signing. Mr. Wolfowitz, said, “One of the most important things I’ve been discussing with my hosts is how the World Bank can do more to support the critical challenge of scaling up rural infrastructure. The Government has recognized the importance of this task for the millions of citizens who live in rural India. I hope this project – which is aimed at making every drop of water count in Maharashtra – can be an excellent example of development work making a real difference for people battling to improve their lives.”
Mr. Chidambaram, said, “Repair, renovation and restoration of water bodies is our national priority. A National Project has been launched that covers restoration of water bodies, either natural or man-made, directly linked to agriculture. The Maharashtra Project supports our national objective as it covers rehabilitation and modernization of irrigation schemes as well as improving the safety of dams.”
The Maharashtra Water Sector Improvement Project will address some of these issues by promoting multi-sectoral planning and sustainable development of scarce water resources, in addition to helping improve irrigation service delivery and agricultural productivity in the state. The Project expects to increase irrigation coverage in the state by about 22 percent and crop yields by 5 to 20 percent. It is estimated that farm incomes on average are expected to increase by 49 percent, and about 33,610 farm families fully dependent on agriculture will be enabled to rise above the poverty line by the time the Project is completed
The World Bank loan from the International Bank of Reconstruction and Development (IBRD) will fund the following components:
Irrigation Service Delivery and Management. This is the main component which will improve irrigation system performance and quality of irrigation service to farmers, promote effective participation of water user’s associations in management of irrigation schemes, increase cost recovery, pilot the implementation of water entitlements, and raise the level of agricultural support services delivery. It will also rehabilitate and modernize 286 selected irrigation schemes covering about 670,000 hectares of cultivable command area, enhance the safety of 291 dams, help in capacity building of water users associations, improve water management practices and instruments, strengthen agriculture support services, and implement a social and environmental management plan.
Water Sector Institutional Restructuring and Capacity Building. This component focuses on institutional reforms that will strengthen the state’s capacity for multi-sectoral planning, development, and management of state’s water resources on a river basin basis.
Innovative Pilots. This component will support four user-centered aquifer level groundwater management, and four innovative irrigated agriculture pilot projects.
BSC/BY/GN-310/05
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